Silly Bands and the Gold Bubble

by | Jun 22, 2011 | Precious Metals | 100 comments

Do you LOVE America?


    A bubble is what happens when individuals who would generally shy away from an asset or investment become so crazed by it, that they throw all rational and logical thought aside in the hopes of attaining possession of said asset at nearly any price, no matter how over inflated its value has become. In almost all cases the asset is priced well above its intrinsic, or real fundamental value.

    Our nine year old son, for example, would never wear pink – ever. He wouldn’t be caught dead in it, for obvious reasons. Nor would he have ever considered wearing a bracelet – that’s something his sisters are generally into.

    Last year however, elementary students the country over became crazed over something called silly bands. They’re little rubber bracelets available in a variety of shapes, sizes and colors – even pink. As the craze took off, silly bands became a hot commodity item. Impulse counters at local stores were emptied of any and all silly bands. Silly band value at school was going parabolic, with some shapes in specific colors being traded on the free market at a ratio of 10 to 20 inferior bands to one of the more “rare” models. Even high dollar action figures worth around $10 retail would be traded for a single band that probably cost no more than a penny or two to manufacture.

    When we did happen across a package of bands at the store, and refused to shell out the $5 for an 8 pack of what essentially amounts to rubber bands, we got the evil eye and a never ending barrage of protests – even the Slavo sisters got into the mix, hoping that they, too, would be the beneficiaries of silly bands once their parents buckled.

    Much to the distress of the Slavo kids, there was no buckling, because we were very well aware that a Silly Band bubble had formed, and a crash in silly band prices and demand was imminent. That didn’t stop the kids from spending their hard earned allowance on them.

    It has now been months since the collapse of the silly band bubble, and what was once a high value asset has become just another piece of trash on the carpet in need of disposal. While the girls may still wear one or two from time to time, Mac Jr. won’t even consider accessorizing his daily apparel with a band.

    That’s what a bubble being blown and it’s subsequent popping looks like.

    When it comes to asset bubbles, kids and adults behave in much the same manner. We are, after all, creatures primarily driven by emotion, as opposed to logic and rationality. As humans we have an inherent need to be accepted, and for most people that means doing what everyone else is doing.

    For the last couple of years we’ve heard analysts the world over declare that gold is in a bubble. We can generally spot a bubble when people who would traditionally shy away from a particular trend or investment become experts and die hard proponents of it.

    The argument from some analysts, investors and market commentators is that gold is now in bubble territory and set to collapse.

    In February of 2010 billionaire financier George Soros was quoted as saying, “The ultimate asset bubble is gold.The mainstream investment community immediately took this statement as a suggestion that Soros believed gold was topping and would decline. At the time, gold had reached all time highs and was trading at $1080 per ounce. Today, it’s trading just north of $1500. What happened? Didn’t Soros say it was a bubble?

    What Mr. Soros said, and what was interpreted by those who hang on his every word were two different things. Within the context of this financial crisis gold is the ultimate bubble. But Soros didn’t say that it had yet reached bubble territory – only that it would be the ultimate bubble within this general crisis. As we know, the crisis is nowhere from being over, and in fact, the economies of the globe are in much worse shape today than they were in 2010.

    Another common misconception among highly paid analysts and pundits is that everyone is buying gold. For a time in 2010 this was based on all of the “We Buy Gold” signs popping up on street corners. Everyone, it seemed, was buying – the “signs” were literally everywhere. A little examination would have gone a long way in determining the extent of this gold buying.

    A couple of weeks ago, with silver trading at around $37 we decided to have lunch at a diner we frequent in the Houston area. A few doors down from the diner is a “We Buy Gold” business, so we decided we’d stop in to see what type of pricing these dealers had just in case we needed to liquidate our precious metals in an emergency. To our surprise, the gold store employed one individual, had absolutely no gold for sale, no cash register, and quotes were pulled in real-time via a Blackberry. We advised the “broker” that we had 10 ounces of silver to sell and requested a quote. Not only did the broker low-ball the silver spot price using an intra-day low for that day (which was $1 lower than the actual spot price at the time, as we pointed out to him when he pulled up the Kitco web site), when it came time to finalize the deal, the broker made a call to his boss. We were then advised that they were willing to pay $30 for the bar, a whopping 20% less than its value.

    Our point with this story is that even though we may be seeing “We Buy Gold” signs all over the place, the dealers are only Buying, not Selling, and when they do buy, they are heavily underpaying the seller. We pointed out to the dealer that he was running what essentially amounts to a scam by taking advantage of uninformed sellers who are probably hard up for cash, which is why they are selling their precious metals jewelry.

    Clearly, the “We Buy Gold” signs and commercials cannot be used as an argument that gold has reached parabolic bubble territory. They may be buying gold, but the average American man or woman on the street certainly isn’t. The only thing they can do in these establishments is sell. So the next time someone uses this as an example of how everyone is buying gold, you’ll know they are touting the mainstream line and really have no idea what they are talking about.

    When we talk about gold buying, we need look only at what is happening in Greece, China and India. Greek buying of gold, for example, proves to be anything but bubble irrationality. It is emotionally driven, but not in the same sense as wanting to wear a silly band like everyone else, but rather, to protect accumulated wealth and preserve it:

    Via The Daily Crux:

    In an effort to protect themselves from the collapse of their banks and government, Greeks are rushing to the only money governments can’t mess with: gold.

    Greek citizens are emptying savings accounts and buying gold as they brace themselves for the possibility of a sovereign default and runs on the country’s banks.

    Goldcore Continues (via Zero Hedge):

    Gold is again being seen in Greece as an essential store of wealth, hedge against inflation and safe haven asset.

    This is not surprising given the scale of the crisis and the sharp falls seen in Greek property and equity markets (see chart above).

    The fact that gold cannot default or go bankrupt unlike every single corporation, bank and government in the world is making it the safe haven of choice again.

    There is also the important fact that it cannot be debased by bankers and central bankers unlike currencies and bonds.

    Greece is the canary in the coalmine and the likelihood is that what is happening in Greece today, people using their cash deposits in banks to buy gold bullion, will be seen in many other countries in the coming months.

    Indeed, news from the Perth Mint of record sales of silver coins is indicative that this trend has already begun.

    Bloomberg reports that “Silver-coin sales from Australia’s Perth Mint, which was founded in 1899 and processes all of the country’s bullion, have surged to a record as buyers seek to protect their wealth with the metal known as poor man’s gold.

    The Greeks are buying gold at unprecedented levels. In the heat of the crisis in 2010, in fact, they were willing to pay $1700 an ounce, over 40% more than the free market price at the time. This was a mini-bubble, as gold prices dropped shortly thereafter, but it was a clear demonstration of how quickly an asset can rise in the heat of panic or market exuberance.

    The Indians are also buying gold. Just last month India saw a 222% increase in gold demand, with consumer inflation and wage deflation reported as the cause in personal purchases of the metal.

    As the people of the world realize their currencies are depreciating and their governments are further destroying their economies, they are looking to preserve whatever wealth they can.

    While we’ve also witness gold and silver demand increase in the US, for most Americans precious metals are still a fringe investment. One reason for this is because financial advisers who have traditionally recommended stocks and bonds have yet to come around to gold as a legitimate investment.

    This ever increasing demand around the world, however, is beginning to open some eyes, and the big money on Wall Street is already beginning to shift assets. One recent example is the University of Texas, which is currently sitting on a reported $1 billion gold investment.

    As big money takes the lead, the smaller money is starting to notice.

    The “ultimate gold bubble” is certainly in progress, but we strongly believe it is still in its infancy. The world may be buying, but we must remember that America has the strongest economy and the most wealth of all nations – and we have yet to begin any sort of significant buying in terms of individual investment.

    As financial, economic, monetary and political crises unfold, we can expect to see the value of gold continue to rise. When asset values start crashing, in real terms, and the public loses confidence in our government and The Federal Reserve, the level of buying will increase, eventually leading to a craze.

    When the “We Buy Gold” signs turn into “We Sell Gold” signs with buyers willing to pay exorbitant prices, and gold becomes the topic of conversation at the water cooler and your local Starbucks, you’ll know we’re reaching the apex of the bubble. When those who would never consider investing in gold today begin attending gold buying investment conferences together with friends and neighbors, or they start recommending books for you to read about gold investing, you’ll know it’s time to transfer your wealth into a different asset.

    Until then, we hold the view that no matter how high the price, dollar-cost-averaging is the best strategy with those who have extra funds available to store and preserve wealth.


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      1. Invest in useful items to trade since no one will be able to make change for an ounce of gold. Can you imagine standing in line at an old warehouse waiting to get toilet paper and what have you with a few ounces of gold. LOL! You will not only lose your gold, but everything else you have as they follow you back to your bug out location.

        • Gold isn’t the SHTF money. It’s is wealth preservation. You would use Gold to buy access to another county like the Jewish people of Germany did, or buy significant assets like land, vehicles or a solar array that works. TP, bread, and small items are why you keep pre 64 silver coin around.

          • MAC: Buyers typically pay 80-85% of spot for gold and silver; which isn’t all that bad if you are selling gold or silver under $600.00 and do not pay tax on the sale of the asset.

            I have heard stories of prospectors melting their gold down to one oz “bars” and then splitting them into thirds to beat the legal requirements.

            That’s what I’ve heard …. 🙂

          • what other country has people in power that would you trust? Thousands of Jews made a payoff just to be cheated out of their lifes work.

        • “Can you imagine standing in line at an old warehouse waiting to get toilet paper and what have you with a few ounces of gold.”

          That Is ridiculous, unless you wanted to purchase a lot and open your own toilet paper trading store. That story would rank right up there with the woman in Germany during their hyperinflation who bought a warehouse full of bedpans, only she did it too late.
          How about instead you break a bit off the one ounce coin and use that instead? Or better still, use links of gold chain or trade your gold ahead of time for small units of silver. I think that’s how they did it in other countries when the economy collapsed.

          If there are People around who are going to follow you home because you used used gold to buy something, they’re going to follow you home no matter what.

      2. I’d love to buy some gold. Anyone got any they could sell me at the going price of silver? Ha!

      3. That’s what gets me laughing at a lot of the gold commercials out there. It’s a whole buttload of ‘doooom… DooooM… DOOOM!’, yet they’re still more than happy to accept my worthless paper money in exchange for gold.

        Now don’t get me wrong – I prep for a damned good reason, and among those preps, a couple substantial bits o’ precious metals is a must.

        That said, I really don’t see much point in stockpiling the stuff like it were going out of style. In many types of SHTF/TEOTWAWKI situations, precious metals will be shunned hard – either due to radiation concerns (what, you forget about that?), or most often, because most folks quite frankly do not have a clue as to how to tell the fake from the real.

        Seriously – one mushroom cloud will be enough to make the entire population swear off of using gold or silver (or any form of metal), even if the actual risk is remote. After all, what would stop someone with lead gloves breaking into a few jewelry stores near a hot zone and loading up, then dumping the results in trade for useful goods a few days later? With the right precautions, they pass along the dangerous stuff as money with little long-term risk of exposure to themselves. So unless you’re willing to tote around a Geiger counter to each and every transaction…

        Can any ordinary person –right now– tell the diff between actual silver and polished pewter? (Note: no peeking at Google now, since Google probably won’t exist post SHTF/TEOTWAWKI).

        These are just the first two that come to mind.

        Personally, in such a situation I’d rather do a direct swap, or barter for labor and/or skill (in either direction).

        the overall key here is to certainly hedge your bets (Hell, I’ll keep some coinage around), but to not rely on it, or to stockpile it like it will suddenly turn you into a post-apocalyptic bajillionaire.

        • “””””Can any ordinary person –right now– tell the diff between actual silver and polished pewter? (Note: no peeking at Google now, since Google probably won’t exist post SHTF/TEOTWAWKI).????

          don’t accept any silver except pre 65 US coins and Silver Eagles.I wouldn’r even trust anything else today.

          • I’d trust silver maple leafs…..the apmex recently issued fractional silver coins, I might use that to take less but I’d still accept them.

        • “I really don’t see much point in stockpiling the stuff like it were going out of style. In many types of SHTF/TEOTWAWKI situations, precious metals will be shunned hard”

          Perhaps, but not likely. The story of the locals rushing to trade their fiat Dollars for thin sheets of gold foil as the U.S. left Vietnam runs contrary to your line of thought.

          Also, RE: “one mushroom cloud will be enough to make the entire population swear off of using gold or silver (or any form of metal),”

          I don’t think it affected metal sales from Japan after they dropped two?

          • Good points, but one nitpick:

            Re: Japan… back then, the typical civilian (and most military types didn’t even know what radiation was.

            Quite a bit different story today.

            • Clark: Point of order here, when WE left Viet Nam the general population wasn’t using “fiat dollars” they were using “P’s” issued by their government.

              Even the GI’s and Marines used “P’s” not dollars. Today the Viet Namese use the “Dong”.

            • @ Durango, …. A couple of month ago, my uncle and his American GI friends were talking about their time in VN. I saw his purple heart and other medals. My uncle was laughing so hard when you said “when WE left Viet Nam the general population wasn’t using “fiat dollars” they were using “P’s” issued by their government.”

              He’s said it doesn’t sound like you’ve ever been in the military before, if so you were never in Vietnam.

              He said, Vietnam used the “Dong” as their currency when he was there, and they still do even to this day. The government was so broke, the “P’s ” never entered their minds.

            • Aso the GIs did not even think about precious metal and could not afford it if they did. They were more worried about getting their as*es shot off.

              The soldiers were not allowed to carry that stuff around anyway.

              They were more interested in cigarettes, alcohol, etc…

              The American diplomats were the looters who bought the gold and cultural antiques from the royal dynasties and transported them out of the country. My uncle’s friend said he had seen some of the pieces that they bought.


            • I wanna hear JANE talk more about using the Dong.

            • @ DURANGO, … Every country that goes to war ends up TOTALLY FINANCIALLY DESTROYED. Britain and Vietnam are no exception. My family were involved in WWI, WWII and the Vietnam war.

              Apparently, you talks so differently than my uncle and his friends.

              I apparently know more about military and vets than you do when you said you were a soldier, and not so much about the Dong currency. What I’ve told you is what I heard from my uncle and his friends who are vets.


              So how many aliases do you use Durangao? I know you are Durango aka Tarzan aka an angry veteran and many others… ummm 🙂


            • “Every country that goes to war ends up TOTALLY FINANCIALLY DESTROYED.”

              Err, what? The US made massive dough off of WWI and WWII, and the technological leaps that were made in wartime were more than enough to fuel some massive economic post-war booms.

            • @ Odd Questioner …You’re like Durango, you both are trying so hard to defend bankers. I am not buying into your propaganda.

              1. You said: “The US made massive dough off of WWI and WWII,”

              – So what happend to Britain, Vietnam and other countries’ economies after the wars?

              – I guess the US citizens have to ask the bankers who financed these countries (including America), and who are the ones that pocketed the profit (aka money).

              Good grief, don’t you know the US has been in debt ever since the Good grief (SAME) YEAR the FED and the ADL opened businesses? – I guess, it’s just a coincidence, LOL..


            • @ Odd Questioner, You’re like Durango, you both are trying so hard to defend bankers. Sorry am not buying into your propaganda.

              Odd said, “The US made massive dough off of WWI and WWII.

              – So what happend to Britain, Vietnam and other countries’ economies after the wars?

              – I guess the US citizens have to ask the bankers who financed these countries and who are the ones that pocketed the profit (aka money).

              – The US has been in debt; good grief ever since the (SAME) YEAR the FED and the ADL opened their businesses. Is it a conincidence???

            • Jane?

              One word: Lithium.

            • @ Odd Questioner …. You are still in state of psychosis, being denial and lying are the signs. You’re mad, because you’re trying to shrove your agenda down people’s throats and got caught.

              – First, you should taste your own medicine, lithium as you suggested.

              – Second, you must do is to start telling the truth.

              – The third thing, stop insulting people and woman when you get caught lying. I am the one who tells it like it is, and unfortunately it exposes you for what you are.

              – Why in the world do you call people crazy? But at the same time you constantly want to argue and sell your agenda by sending multiple postings directed to me. That’s another sign of a crazy person’s actions, now go take your lithium. 🙂

              – Why in the world do you call names and insult woman when every time you loose an argument? That’s another sign of a sick mind, go take your Lithium. 🙂

              @ Odd Questioner … You’re like Durango, you both are trying so hard to defend bankers. I am not buying into your propaganda.

              1. You say: “The US made massive dough off of WWI and WWII,”

              – So what happend to Britain, Vietnam and other countries’ economies after the wars?

              – I guess the US citizens have to ask the bankers, they have been using taxpayers’ money to financed countries (including America), and they are the ones who pocketed the profits. (Read the articles about this.)

              Good grief, don’t you know the US has been in debt ever since the (SAME) YEAR the FED and the ADL opened their businesses? – I guess, it’s just a coincidence, LOL.


              I have to repost, because my original posting did not show up – And if it does, Mac please delete it.


            • @ Durango = BJ = Tarzan = Anony = an angry veteran and others….

              Durango, Don’t continue to go other name to distract from the issue while demonizing me at the same tiem.

              The main issue is Durango was never a soldier in Vietnam. He is trying to claim he was a soldier, just so he can bash the veterans who were there. His headquarter can provide him information about the war that he might need, so he can sell his propaganda.

              As you know bankers raised the debt ceiling so the South Vietnamese govt. could continue to fight the Vietnam war.

              And then they reclaimed their natural resources.

              So the dong was worth nothing and they were experiencing hyper-inflation. Ask any vet, they will tell you.

              In response to: Anony says: June 25, 2011 at 1:27
              “I want to see Jane use the Dong!”

          • .

            The year, I was talking about was 1913. Im not 100% so sure, a century ago = 100 years.


            • Tarzan: Did you swing up with crazy Jane?

            • Time for Anonymous man to take viagra and lithium.

              You have a personal vendetta of trying to make this site your own and turn it into trash. You have too much time on your hands. My suggestion:

              – Join Bill Clinton, Sean Penn, Randy More, are leading college students to work on a very big project, globally.

              – Contact Monica Lewinsky and watch “The SPY WHO LOVED ME.” If you can’t find her, then contact Bill Clinton for assistance.

              – Don’t forget to take your meds.


            • I smoke Montecristo #9’s. #10 for you. Damn, I knew you were my girl! I’m down on one knee replacement. How long do you expect me to wait? You have red hair right? I like it when you wine! How did you know my birth year?

        • Wow, need to read a book or two.

          Radiation and PMs: If you really want to make a PM radioactive, you MUST crash protons or neutrons into it. The easiest way is in an accelerator. Now if the PMs are in the actual blast zone, a few molecules might gain a proton or neutron and become radioactive, but in order to make it dangerous, well it ain’t gonna be. It takes a heavy dose of radiation to the point of no jewelry store left. Hell, ain’t nothing left.

          So what about fallout? Fallout is dust and larger particulates that were vaporized in the blast. These are radioactive. BUT exposure to fallout doesn’t make the exposed item radioactive. The problem with fallout is cell damage. PMs aren’t alive ergo no cells to damage. Now the question of fallout contamination is interesting in itself. #1 it washes off. #2 if the fallout contamination was heavy, wait a couple of days as the looter is dead. A few hundred rads over a few days spells death. See #1 above.

          I can tell the difference, but my friends will attest that I’m far from ordinary. Not extraordinary but more like just special. But my doctor says if I stay on my medication I will be alright in a few more years. Sneaked a peak at my chart and there was some fancy jargon about this boy ain’t wrapped tight.

          Complete agreement on the first two. PMs are specialized articles of exchange. Sure I’ll trade a roll of pre-64 dimes for something of higher usage value. If it ain’t usable, any value is questionable. Will PMs have value a few years down the road? Probably, but please define a few years. 30 or 40 years is probably well past my expiration date.

          • “If you really want to make a PM radioactive, you MUST crash protons or neutrons into it.”

            Agreed to an extent (mostly in how easily it is to contaminate), but the perception is what matters most. You’d still have to drag along that Geiger counter, if only to prove to the recipient that no, it ain’t going to glow in the dark.

          • OTE: Sneak a peek at that lead pad they use for x-rays. I have heard, but have not seen, that enough exposure to x-rays will change that lead to gold. That process is not used commerically because it is too expensive, but as a by product to medical proceedures, the cost is incidental.

            Or is that a fairy tale?

            • Not X-rays, Alpha Particle, 2 protons & neutrons.

              Problem: It does create radioactive gold, but its small quantities, (and nothing says that the new radioactive gold isn’t bombarded again).

              Its also a smattering of gold atoms in a brick of gold.

              In a silicon block you can do this and make phosphorous , increasing its ability to be used as a -Super-Semi-Conductor. (Read-Military Grade Only: McClellan AFB California has a reactor that does this.)

              -Possible: Yes.
              -Practical: No.

            • You are the most gulable person on the planet.

        • silver jewelry is marked 925 or sterling, unless its from mexico, it may just say “Mexico”. all silver plate is required to be labeled as such and has been for a long time. Silver plate tarnishes different than silver and anyone who spends a few minutes studying both side by side will get a very good idea how to tell the difference. Pewter is even easier to discern from silver, you can always see the lead content in it if you know…..maybe not for the average moron but it doesn’t take much to learn the difference. I have bought more than a few pounds of sterling jewelry over the past year for pennies on the dollar and never get “fooled”

          • I don’t doubt that there are quite a few who can tell the difference, but the point was more that the average person probably can’t, and until they can, there won’t be enough trust to facilitate trade.

      4. Owning precious metals is piece of mind for me & my family — given the U.S. & World financial situation. Luckily we bought a lot of it a few years back so we aren’t paying these high prices.

        I see gold and silver going way up. Many folks are saying $5000/ounce for gold. We don’t have tons but we have enough to make me comfortable that I’ll be in very good shape if the shtf.

        The sheeple with $15 in their wallets are in for a real surprise if/when things collapse and their ATM & Credit cards don’t work anymore.

        • How much food do you think that you’ll be able to buy for your family post-SHTF with gold? More than likely you will just present yourself as atarget to the parasites that would slit your neck for a tank of gasoline. Comfortable is just the wrong term. Don’t get me wrong, I’m not trying to verbally beat-up on you. I, too have PM’s in a quantity, I just don’t believe that by merely possesing them that I, or my family, will be comfortable.My wife and I feel that skills (food production, land management, animal husbandry, etc…) and practice (especially marksmanship!) are the best preps we can make.

          • There is a person out there who get’s it!

        • I hope you have plenty of food and other items stored away, enough for over a yr or even two because you can’t eat gold or silver and I doubt anyone is going to have anything for sale for a long long time.

          • “I doubt anyone is going to have anything for sale for a long long time.”

            As if the nature of People to trade with one another suddenly vanishes?

            • Trading will not suddenly vanish, but many people will not have anything to trade and the smart ones who do will keep it out of sight til the dust settles.I know that I’ll not be advertizing or trading what I have til I see what kind of society is floating to the top.Another reason for covering all the bases when I started prepping.I’ll want nothing and I’ll give nothing.

            • “As if the nature of People to trade with one another suddenly vanishes?”

              It will for quite awhile…

              Trade requires three things before *anything* happens:

              * trust between parties (good luck with that while crime runs rampant, and the majority of folks out there are on the edge of starvation, if not outright starving.)

              * trust in the medium of exchange (until folks at large gain sufficient skill with spotting fakes, and insuring that the medium isn’t otherwise tainted or useless, they won’t accept it under any circumstance).

              * something to trade with/for (initially, everyone is going to hold on to whatever they have with an iron fist – prepped or not. Not until some means of sustainable production (and surplus!) occurs will you see any meaningful form of trade. The Dark Ages suffered from this pretty hard, incidentally).

              The nature will certainly be there, but will IMHO be suppressed for quite a long time, depending on severity and duration of the crisis.

          • Got about 4 yrs of food stored, along with lots of other items. And am now ramping up food growing ability with new growing space cleared, orchard planted, new greenhouse under construction, and so on. I’m getting ready for the day when food stops traveling a thousand miles before it ends up on your table, and the local, small producer is the “go to” guy. I plan to have plenty of perishable food to trade for silver/gold…..and will be paying farm labor (and guards) in food/metals….just like the old days.

      5. A little history. Y2K; in 1999 there was a run on the 1/10th ounce of gold (essentially the dime size) and there was a great shortage of the 1/10th ounces. As of today there is a shortage of the gold dimes again. Around 2002, there were a large number of the gold dimes returning for cash. I bring this up to warn people not to cash in your PMs, no matter how high the value is in dollars. The gold coins are still valued base on their weight; 1oz is still 1oz. The value in currency only tells you how worthless the currency is.
        I’m pleased that there are a number of sellers of gold, but you have to remember, there are only so many gold coins and bars. We trade currency for metals, what are they doing with the currency, buying more PMs? The sellers are speculating that prices will drop and as with Y2K, people will trade in the PMs for cash again.
        Please don’t be fooled by the dollar amount value of PMs, hold on to your PMs.

      6. The fiat (pick one) is a bubble. Most people don’t know what real money is (including a few here). They are not only stupid but wrong. I think Dirty Harry said that…

      7. I usually buy brass, lead, and copper…oh, and gunpowder.

      8. It’s better to buy tangibles anyway…while you still can. Imagine, the next “currency” might be rolls of toilet paper!

      9. This is true but always keep an ammo can of gold and a few extra of silver. Act like they don’t exist even if we go to 10000 and back to 300 gold and 4$ silver. There is your real financial security blanket.

      10. In books like A Second After .22 rounds were more important than any PM’s. Same could be true in the future but only time will tell. I really try to invest my money in items that will have value later when TSHTF.

      11. I got mostly silver mercury dimes and pre 64 quarters. I have picked up a few, around twelve, silver eagles. The bulk is in the dimes when I pulled my IRA and closed it. Most of my extra cash is going toward more food, meds, canning supplies and seed. Gotta pick up a Berkey water filter, definitely a good perculator coffee pot, some more reloading components and a grinder to crack corn for the chickens. Gettn back to the title subject, Ive never needed to be a veterinarian to know a horses ass when I saw one. That said, I didn’t have to wait for these neophyte, longerberger basket buying, bingo players to start delving into the art of buying gold and silver to convince me.

        • make your own – I did and saved a hundred bucks and change. google homemade berkey water filter.

          • Roger that Scott. Many thanks!

      12. Marco

        Get off you high horse if people wish to sell at a discounts thats not a scam its a necessary sale/ Lying is another story just the facts please – also the childish rubber band analogy was ridicules, Sorry your not the sage of Omaha and even less so with expired date code coming out the ears try a little bit more of an even approach adds to credibility we get your get point now get mine. Stop the sensationalization and hysteria and when there is a problem tell us how to fix it don’t create one Hey how about something useful I mean really useful ?

        • Paragraphs are your friends. Learn about them and then employ them; doing so will make your point more understandable.

          Thanks Mac for the personal story to illustrate a point. From the micro to the macro, so to speak.

          If I had another point, it’d be here, in a new paragraph. See? If you are Stephen Hawking posting here with a tongue keyboard I apologize in advance.

          • LOL, PERFECT!

      13. Don’t put all your eggs (resources) into one basket (gold/silver). Try to cover all the bases; food, water purification, arms/ammo, precious metals (pre 1965 dimes, quarters, halves, Silver Dollars, gold & silver bullion), medical supplies, alcohol, clothing, shoes/boots, etc. Stock up on items for personal use as well as barter.

        Knowledge and required skills will be in high demand during and after a SHTF scenario. Do you know how to tie a knot and what knot should be used for what job? Then now might be an excellent time to download and print some of the many free informational tracts available on a wide variety of subjects online.

        Whatever you do; I would seriously recommend completing your preps in the near term rather than waiting until later. Hurry up and get your ‘chit’ together boys & girls. I have a really ominous feeling that the ‘helter-skelter’ is almost here. The ‘do-do’ is already flying through the air headed in the direction of the fan.

        Be sure to watch what is happening in Greece and in the EU. They will be first ……. but the US will be right behind them. Once you see Greece ‘take-it-in-the-shorts’ and the Euro falling off the proverbial cliff ….. I would seriously think about cleaning out anything left in the bank account, filling the gas cans, snag a couple of extra bottles of propane and seeing if you grab some last minute essentials. Once you see the EU start to tank ……. the US will be perhaps a week to ten days behind.

        God Bless and good luck to all.

      14. I agree with MadMarkie. Definitely priority first should be food, water, clothing, firearms/ammo and medicine/first aid.

        I have this feeling that the TPTB will avert the Greece & EU crisis as well as the Fed saving the world again by QE3 or something and everything will be fine and hunky dory.

      15. “The world may be buying, but we must remember that America has the strongest economy and the most wealth of all nations – and we have yet to begin any sort of significant buying in terms of individual investment.”

        America HAD the strongest economy and the most wealth, but it has been stolen. All savings is in worthless paper, and most people don;t even have that.

        The American people are broke. Everything the elite does it to take wealth away from America and spread it out to support more slaves in the third.

        The only individuals with money to invest are the poor fools in 401K’s and other such nonsense. And that will soon be converted to worthless paper that value can never be extracted from.

        The corp has taken, or is in the process of taking. everything the People had. Most don’t realize it until what they had is taken, and by then there is nothing left to buy junk like gold.

        In spite of all the hot air in the US these days, there is no way the serfs here can inflate a bubble of any kind.

      16. The old “beans” versus metals argument.

        The prudent man has both, because while the S_may_HTF, it also MAY NOT……and we could continue with the FED motto ( “Making it harder to put dinner on your table since 1913” ) for many many more years…..just like we have for my 60 odd years.

        For most people, BOTH aren’t an option. In that case, beans/etc are the clear first choice. But if you have the means, do both….piles of both…..ANYTHING but Federal Reserve Notes, because they ARE going to depreciate by system design.

        • I would think that a few cord of Federal Reserve Notes could heat a small cabin and cook a few beans, During the 40s we were getting 3 bucks a cord for softwood and 5 bucks for hardwood, today, up here, hardwood is going for 225 per cord, FRNs are worth less.

      17. Actually, MY barter experience in Nam was that a CARTON of 12 pkgs with 20 Kool menthal cigarettes in each pack went a very, very, very long way for anything you wanted.

        Especially if you were a non smoker. American menthal cigarettes were highly prized by the Viet Namese.

        Better than money. Just saying. Post SHTF it could be coffee, alcohol, smokes, or illegal drugs. Not to mention aspirin.

        MM is right. Make hard copies of the info you need, now.

        • I can tell you right now that in Oregon and Northern California, the alternate currency of choice may well be marijuana and/or its seeds (it’s legal to grow/use it for medicinal purposes out here w/ a license).

      18. The real message here is that Slavo wouldn’t spend a lousy five bucks to make his kids happy. So what if they look like rubber bands. I feel bad for your children you cheap Jew.

        • I see these at the dollar store all the time..and at Goodwill stores..I wouldnt pay a friken buck for them either! And Im Souix and Chippewa and Irish not a jew.

        • I remember the silly band bubble. Early on a Walgreen’s employee said they had disposed of their display because they wouldn’t sell and then the bubble inflated and they were hard to find. Now they are everywhere, and cheap. I am sure the same companies that initially manufactured these were the ones who flooded the USA with billions more under numerous brands when the bubble was rising.

          I grudgingly bought some during the bubble, even knowing what was happening. Anyone remember the yo-yo or knicker-knocker crazes in the 70s?

          • We called ’em clackers. Lots of fun and a great potential weapon! I think that was back when music was still music and it came on vinyl and went around at 45 rpm. And Duncan yo-yos were the best! Walkin’ the dog!

            • Lol, use to see alot of them (clackers) hanging over powerlines while traveling down the road. Probably some pissed off parent who couldn’t stand the noise….guess I know now where mine ended up.

      19. Using the Fed’s M1 money supply and the Treasury Department’s assertion that they own 261.5 million ounces of gold, this would put gold at over $7,400 an ounce.

        Using the Fed’s M2 money supply relative to the 261.5 million ounces of gold believed to be owned by the government would put the price of gold at over $34,000 an ounce.

        No, gold is not in a bubble, the rest of the asset classes are…and they are all about to come crashing down relative to gold.

        • Hey Howard: Thanks, I like the link and the numbers but I need some help here. If there are 12 oz of gold to a pound, and 2000 lbs of gold to a ton, how many tons of gold do WE have?

          My understanding has been that the USA owns 8.5 tons of gold. Don’t have a calculator handy, but it seems that 261.5 million oz of gold is more than 8.5 tons of gold, by a bit.

          • DK I think you are so wrong….

            First of all, a Troy oz Is roughly 1.1 regular oz. Secondly, we have NO IDEA how much gold the US has as there hasn’t been an audit in since the 50’s. The way things are going I’m going to say we have no gold. Sold or leased away.

            Read the Troy oz wiki. Btw when you buy a gold Eagle in will weigh more than one troy oz… It is alloyed a bit but still has one oz of gold. Canadian gold maple leafs are more pure than US eagles but as a result are VERY easy to scratch or damage. Both contain one Troy oz of gold.

            • Yeah I meant 8500 tons of gold, not 8.5. The latest figure I saw, a couple of days ago, was 9300 tons of gold.

              There is 12 troy oz of gold per pound. 2000 pounds to the troy ton? OUR gold should be calculated in troy oz when it is measured and assayed.

      20. I would like to have a toast with all my prepping friends on this thread…So here we go!

        “Here’s to you and here’s to me and may we never disagree but, if we do…The Hell with you and here’s to me!”

        Peter Schiff had this to say, “I think anything in the low $30’s represents a pretty good entry point for people to buy…Once we go through $50…I see silver going to $200 an ounce. I own a lot of silver personally because of that outlook.”

        • I’ll drink to that! In fact, I am as we speak.

          Au or Ag should be bought after your other preps are reasonably addressed.

          • agreed!

            • ++1!

      21. I am both concerned and prepping as best I can. Over the last two years, my wife also fighting cancer, we have acquired what we could afford. Retirement due to a forced sale of 401K and stocks was done, much of it spent on preps. About a years worth of food, several hundred gallons of water, Katadyne filter, water harvesting equipment, rifles, shotguns and pistols, ammo for all, especially the .22, gas, propane, heaters, camping gear, three generators, lanterns, fire extinguishers, solar rechargeable lanters, windup radio and light, heirloom seeds, medications and about a hundred ounces of silver. I do not have much cash, hope to get some soon, We all know the drill. My wife of thirty years getting sick would probably prove a death sentence in a SHTF scenario. So yes, I am fearful with good reason. It’s bad enough slowly going broke in this economy, as so many know, now this……thank God I live in a small town, with small town values, lots of guns and folks that know and help each other. Yet so many ahve done nothing…and if it all falls apart, I can only hope to stay below the radar and if necessary, use my guns. And I pray….a lot. For oddly enough in the eyes of many, God remains my best friend.

        • Sorry to here about your wife as my wife and I have just celebrated our 30th anniv. Hope your wife gets well real soon. Keep the faith and may God bless you.

      22. Back in the good ole days I used to be a stockbroker, and I learned the most useful information from old guys. Old guys know, that is how they got old. Old guys keep it simple. Old guys can usually say it in one sentance, keeping it simple.

        I will share a couple of tidbits.

        1)Information, which everybody on Wallstreet knows, is valueless information.

        2)When bond (esp muni bond) buyers start asking about investing stocks, it is time to lighten up on stocks.

        4)There are only 3 things you can do with your wealth.
        ..a)use it- cash (food, toilet paper)
        ..b)loan it- bonds
        ..c)own it- stock
        Everything else is a just fee added, concocted, mash up of those.

        5)The market will keep going up until the last guy in “in”… then it is a top.

        Are we at a top in gold?
        I dont know, is the last guy “in” yet?

        • My sources, Host(s): Robby Noel
          Call In Number: 800-313-9443
          Show Time: Monday – Friday 2:00 PM – 4:00 PM CST on
          says, Gold to $2000 – $5000 and up.
          Silver to $50 – $80 and up.

          He has been right sense I started listen to RBN when Gold was $680

        • No way is the “last guy in”. Gold is the one global commodity that everyone in the world wants instead of their currency. So there’s alot of depth to the market and it will only get more frenzied once real inflation starts.

          Probably after the next US election; especially if Obama is elected.

      23. Buy Gold,
        Buy Silver! hi ho Silver…

      24. That guy, not even close, the first few are in gold, it has a long way to go, and that way is UP!

      25. Kent go to you tube and look up the video World without Cancer, you can learn the cure with natural Herbs, Good Luck!

      26. anyone hear that pm’s will not be able to be bought or sold after July 15 was reading internet site a few days ago in some report and this “rumor” came on the screen anyone else have any inside info?

      27. Odd Questioner’s mention of The Dark Ages plays well in the popular imagination, IMHO:

        Rampaging hordes – or darlings of the Dark Ages?

        “Most people’s image of the Vikings centres on their arrival and the disruption it brought, but that only continued for a very short time,… Afterwards they started building settlements and interacting with the locals and influenced them in many ways. They provide a clear example of how a particular group came into a sophisticated, established society and the resulting interaction was positive.”

        Odd Questioner said, “Trade requires three things before *anything* happens:

        * trust between parties…”

        And that’s why People should network with like minded friends and such.

        Odd Questioner said, “* trust in the medium of exchange (until folks at large gain sufficient skill with spotting fakes, and insuring that the medium isn’t otherwise tainted or useless, they won’t accept it under any circumstance).”

        Many People already have these skills.
        Also, notice a number of grocery stores in the U.S. already accept silver and gold as payment. See: Youtube.

        Odd Questioner said, “The nature will certainly be there, but will IMHO be suppressed for quite a long time, depending on severity and duration of the crisis.”

        There was a Person on SHTFPLAN who commented about life in the Soviet Union after the fall, her story seems to be contrary to this position.

        People act in their self interest, if it’s in their self interest to trade, they will trade.

        • Heya Clark! 🙂

          Re: Vikings/Danes/Norsemen… they were only a later part of the Dark Ages – it can be said that they were the ones who may have jump-stared international trade again. Earlier on, it was a constant bout of inter-tribal squabbling as local lords wrestled with each other to gain control. Throughout the European continent, you had relatively nothing going on. Sure, there’d be a trickle of trade here and there for finished metal items (weapons, armor, etc), but very little actually went on (things like swords and armor were mostly passed down or pillaged), and certainly nothing much for Joe Peasant to participate in.

          The point was that trade in general was down to nothing for quite a couple of centuries.

          [trust between parties] “And that’s why People should network with like minded friends and such.”

          This is true. OTOH, even a network of like-minded friends may change drastically post-SHTF/TEOTWAWKI, since those friends could find themselves isolated, besieged, dead, packed off to a camp, whatever. Unless it’s a really big network *now* and everyone is physically close enough to actually do it, things are going to be pretty tight for awhile.

          Also, sure you can trade among friends, but what happens if they don’t have what you need?

          [spotting fakes] “Many People already have these skills.”

          “Many” as in what percentage? It’ll also vary quite a bit by area. I can certainly see where someone with these skills will become invaluable post-SHTF, where they take a tiny percentage of the metal in exchange for certifying that what you have is legit. Call that person a ‘professional referee’, say.

          “There was a Person on SHTFPLAN who commented about life in the Soviet Union after the fall, her story seems to be contrary to this position.”

          I saw it, and it also noted a big, fat caveat: The former USSR had a unique culture with a long standing tradition of black-marketing, smuggling, and the like. Also, in that particular SHTF situation, the government still existed, long-distance transportation still existed, and goods still flowed.


          Now mind, I’m not saying that all trade will cease. I am saying however that in a sufficiently ugly SHTF or especially an end-of-world situation, trade isn’t going to automatically flourish where commerce once sat, and that it may be awhile before it starts up again.

          There’s going to be a period of time where everyone will fend for themselves, and not much else. They’ll trade only if what they need is critical to remaining alive. That trade will likely involve a straight barter, since gold has no calories, BTUs, mechanical value, medicinal value, and you can’t wear it.

          Sure, later on when things settle down it’ll come in handy, especially for black-market purchases. The only real unknown though is how long that period in between will last.

      28. One more bit about The Dark Ages:

        After Empire: Dark Ages or Innovation Explosion?

        …”In contemplating the eventual collapse of the U.S. Empire even those who are against the Empire dread the aftermath. Won’t America, at the very least, plunge into a Dark Ages? After all, isn’t that what happened after Rome fell? Stark says no. Could his description of the end of the Roman Empire be our future history?

        …when the breakup of the Roman Empire ‘released the tax-paying millions… from a paralysing oppression,’ many new technologies began to appear, and were rapidly and widely adopted, with the result that ordinary people were able to live far better, and after centuries of decline under Rome, the population began to grow again…”

        • Good read. I wonder if that’s a general view, or was it localized, or…?

          I agree that with the Romans gone, the monster tribute (okay, “taxes”) were no longer a problem. OTOH, that void quickly became filled with local warlords, each fighting the nearest other for control and power.

          As far as if the US would fall nito such a thing? I honestly don’t know, since a lot of the answer depends very heavily on what the crisis is, for how long it lasts, and how many casualties are involved once it really hits the fan and begins to splatter.

          An economic implosion? Probably not as big a deal as a supervolcano or asteroid strike. In between we have things with wide variables like pandemics, rebellions, and etc.

      29. One of your best articles ever Mac!

        • KY Mom asked, “Could someone explain this?”

          It seems to be self explanatory, however:

          The U.S. Government Attack on Gold

          “All holders of gold should be alarmed. I expect more developments along these lines. In my view it is an attempt to gain control over how, when and where gold can be used.”

          The Bastards Want to Track Our Gold!

          “…If you understand the “Kimberely Process” which certifies which diamonds are not “conflict diamonds”, you have to understand that the process won’t stop at the mining source. Eventually all gold will be required to be “proved” that it comes from a non-conflict zone and there is no way that can even be attempted without a serial number on each coin. We are not there, yet. But the program announced by the World Gold Council is sadly another significant step toward the attempt to track all gold…”

      30. I wouldn’t trust someone saying the heavy shiny substance in his hand was gold or silver. But it’s difficult to fake a bullion coin from a national mint. Even now it would be very difficult for somebody to counterfeit one of those.

        Second point is, gold is for preserving wealth. Silver is for the small exchanges. Those people who say you can’t eat PM don’t get it. You can’t eat a socket wrench either. The wrench has its uses but most likely it will never be a medium of exchange.

        • You have the right attitude. Silver is for making money. This ball game gold will be for trading.

      31. I hope they make it illegal. LOL

      32. Odd Questioner said, “…a big, fat caveat: The former USSR had a unique culture with a long standing tradition of black-marketing, smuggling, and the like.”

        Like we don’t have that here in the unitedstate too?

        Also, I found another good one about the Dark Ages, trade and prosperity:

        Beyond the Barbarians’ Lines

        …”Life improved for residences of the provinces after Rome fell. Thomas Schmidt cites Joseph Tainter’s book, The Collapse of Complex Societies (1988). Schmidt writes:

        The standard of living of citizens in the new Gothic kingdoms actually ROSE after the collapse, as the burdens of supporting the central state disappeared and the citizens taxes went to support local rulers who did provide some protection in return for their exactions.

        One of the great weaknesses of standard accounts of the Middle Ages is that they compare the poverty of the provinces with the wealth of the city of Rome in the early Empire. This is completely misleading. The comparison should be between the provinces in the first century with the provinces five centuries or more later. Here, the typical serf was better off under the manorial system of the so-called “dark ages” than the slave had been in Augustus’ day. Farming was more efficient, due to crop rotation. Metallurgy was more advanced. Road building was not, but the roads had been more for military control than trade.

        Economic historian Robert Latouche as far back as 1956 argued that, in comparison to the heartland of Western Europe in the early Roman Empire, economic conditions were better during the dark ages. Another economic historian, Rondo Cameron, two decades ago wrote that “medieval Europe experienced a flowering of technological creativity and economic dynamism that contrasts strongly with the routine of the ancient Mediterranean world.”…”

      33. Jane: Just saw your posts. I arrived in Da Nang by Continental Airlines on November 10th 1970 and left 4 months and 19 days later.

        When I arrived all of my American dollars were confiscated and replaced by Vietnamese script, which was referred to as “piasters” and “pesos”, or “P’s” by the Marine Corp.

        The Viet Namese in and around I Corp (Da Nang)used this Viet Namese script also. North Viet Nam probably used the “Dong” as the entire country does today. Whether South Viet Namese referred to their script as “Dong” in Viet Namese I cannot say. All local individuals with whom I dealt used “P’s”

        If your family members were in the Army and in the South near Saigon, they may have used the term “Dong”. The point I was making to Clark is that the South Viet Namese were not rushing to dispose of their “dollars” because “dollars” were not in circulation in Viet Nam.

        As usual you missed the point of the post! 🙂

      34. I want to see Jane use the Dong!

        • @ Durango = BJ = Tarzan = Anony

          As you know bankers raised the debt ceiling so the South Vietnamese govt. could continue to fight the Vietnam war. And then they reclaimed their natural resources. So the dong was worth nothing before the war ended.

          See my previous postings which already provide the answer

      35. the only way to retain what wealth you have is through hard assets like gold and silver… so all you naysayers out there just keep knocking gold and silver very soon the only thing going up will be just those two as everything else hits rock hard bottom and land will drop another 40% … silver, food, bullets, decent guns… is all you should focus on and your victory garden and winter indoors gardens… soon people will be stealing their neighbors vegi’s from their back yards just to have a healthy meal and poaching deer and rabbits for fresh meat! Just watch and see says me… ;0P

      36. Interesting comments….perhaps a touch too much “I’m right and you suck” going on.PM’s have a place in everyone’s stash.My grandfather(who was told this by his grandfather)put it like this:”A small bag of Gold,(to start over when things get REALLY,REALLY bad and you have to leave home and go somewhere new to start over)2(two) modest bags of Silver in case the paper stuff gets worthless and you need to buy bread for your family.But the main thing(if at all possible) was to have a intensive kitchen garden to “put food aside” to hold you thru the winter months.On a depressing note,It’s unfortunate the “Boys in Blue”are acting less and less like protectors of we the citizens and ever more like thugs in uniforms.I thought we had the TSA for that.Far too many have no qualms about “adjusting” the Laws to fit their personal agendas.Because of this and the ONGOING massive Federal corruption in Congress and what ever feckless person they put in charge,I expect that America is going the way of Argentina.Not quite the SHTF scenarios we might expect, but when Detroit City now has SIXTY(60) kids in a public school classroom.Not a happy moment for the future.AND it’s Coming soon to a town/city near you!!!
        If that’s the future(no matter what the primary causes are)Even the UBER-Rich won’t be able to “hide somewhere safe” when it’s finally a world-wide problem that everyone suffers from.And let’s not forget the ongoing nuke pollution the air and water headed our way thanks to our Japanese friends(The power company that caused it in the first place is telling everyone there to plant Sunflowers to fix the pollution!What hubris!!).That particular evil has been entering the air of California and headed points east.
        I might be wrong,and let’s hope so!
        Stay warm(or cool if you live in Texas)

      37. Can you eat gold? Make a sweater out of it? What will it be worth when the $h!t really hits the fan? Worthless! You can’t use it to hammer a nail! It will be just another shiny rock. Good luck with all those shiny rocks! LOL.

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