Which should I put in my physical precious metal portfolio?

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NicMM's picture
NicMM
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Which should I put in my physical precious metal portfolio?

I am setting up a self directed IRA and putting $100k into it. I want to invest in physical precious metals. But in terms of portforlio, what should I put in my account? 100% gold coins? 50-50 gold-silver? 33-33-33 gold, silver and platium?

What's your take on it? I really appreciate your input!

Nic

 

 

NicMM's picture
NicMM
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I know it is a personal

I know it is a personal choice. But really appreciate your opinions.

NicMM

Poet's picture
Poet
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What I Would Do

In order.

1. Prepare for resiliency: food, shelter, water, health, etc. (e.g. "What Should I Do?" series).

2. Pay off all debt.

3. Physical metals. Mostly silver if poor, going into gold if rich.

4. Self-directed IRA, only if you feel the need to. Probably 50% cash, 50% gold and some silver - hedging your bet between inflation and deflation.

Personally, I'm still at Stage 1, though debt free.

Poet

sofistek's picture
sofistek
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Be wary of PMs - Nicole Foss

I heard Nicole Foss talk at the weekend and, in answering a question about PMs, she was unsupportive of investing in them, except as a very long term (>20 years) strategy and, even then, only silver as being something that may be tradeable, day-to-day, being of much lower value than gold. But she reckons that gold will fall to about $600/oz and silver to about $5/oz. I'm not sure she mentioned the timescales (for the devaluation) here but I got the impression she was talking about the next few years. I bougt some PMs about 9 months ago, partly on the continued insistence of opinion here, but I'm slightly down on that, at the moment, and have been down ever since buying, apart from a couple of weeks.

I have no idea whether Nicole is right or wrong but she's a smart lady, so that's something to thing about.

Poet is right - first prepare. No-one knows the time-scale for a crash but it could affect any one of us at any time.

TNdancer's picture
TNdancer
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The Indians and Chinese have

The Indians and Chinese have been buying hand over fist every time gold takes a slight dip.......I tend to think a floor has been set for gold around where the price is now.   The Chinese plan is to trade most of the paper we've sent them for real money......going from the reported 3,000 or so tons they have now well past the alledged 8,000 tons we have.

Throw in the fact the FED is having to buy half ( or more ) of the new federal debt issues, using printed money, and how anyone can think gold is going back to under 1,000oz is amazing.  I'd be more surprised if they manage to keep it under 3,000/oz in the next few years.

TNdancer's picture
TNdancer
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The Indians and Chinese have

The Indians and Chinese have been buying hand over fist every time gold takes a slight dip.......I tend to think a floor has been set for gold around where the price is now.   The Chinese plan is to trade most of the paper we've sent them for real money......going from the reported 3,000 or so tons they have now well past the alledged 8,000 tons we have.

Throw in the fact the FED is having to buy half ( or more ) of the new federal debt issues, using printed money, and how anyone can think gold is going back to under 1,000oz is amazing.  I'd be more surprised if they manage to keep it under 3,000/oz in the next few years.

ao's picture
ao
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sofistek wrote: I bougt some
sofistek wrote:

I bougt some PMs about 9 months ago, partly on the continued insistence of opinion here, but I'm slightly down on that, at the moment, and have been down ever since buying, apart from a couple of weeks.

I have no idea whether Nicole is right or wrong but she's a smart lady, so that's something to thing about.

Well, you delayed and delayed and then bought the PMs at near peak prices so ...

And Nicole is very smart but I've seen nothing to indicate that she is highly knowledgeable, skilled, or gifted in the investment arena.

NicMM's picture
NicMM
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 Wow, the level of

 Wow, the level of responsiveness and the divergence of the opinions made me a little hesitate.  Since when people start to think the crash of PM?

NicMM

 

Arthur Robey's picture
Arthur Robey
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Getting the Show on the Road.

Nichole Fosses argument as I understand it, is that when they slam the bank doors shut you will be left with whatever cash you have in your hand plus whatever food you have in your larder.

Desperate debtors will be at your throat. It will get ugly. The rates and taxes will have to be paid. So you had better be fattened up for the winter. Your neighbour will be willing to trade his fattened calf for a shilling.

Later we get a barter system going, and later still we begin to mint silver coins to get the show back on the road. But this show will go by calf power, not horse-power.

How long does this process take? For the Ritilin sound-bite generation, too long. For me, not long enough.

Poet's picture
Poet
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Putting Precious Metals In Perspective

The important thing is to have made preparations, learned some skills, prepared a place, and obtained some equipment and supplies FIRST - so you don't go spending what precious cash or coins you have on obtaining them later.

I've said this before in another forum area:

Whether in deflationary times or hyperinflationary times, both jobs and adequate money may be difficult to come by for most people.

Great Depression: deflationary. Weimar Republic or Zimbabwe: hyperinflation. In either environment, ordinary people had a difficult time with rampant unemployment and inability to afford necessities. In both cases, not enough money.

In a deflationary environment, even if prices go down for elastic goods, jobs are harder to obtain and money is scarce to come by as those who do have work, earn less.

In an hyperinflationary environment, it is also possible for jobs to be difficult to come by, and pay to be inadequate to meet existential needs, as pay may not rise for those who do have jobs, or only rises pathetically in response to inflation.

In a stagflationary environment, prices rise while pay stagnates. We know what that's like. It happened in the 1970s and has been happening for some time now. If you follow the real earning power trend, it's been like this since the 1970s - masked partially by women joining the work force to keep the family afloat economically.

Let others focus on hoarding cash or gold and silver coins. You won't need as much because you won't need to spend as much: you've already prepared. You may even find yourself in a position to exchange your surplus accumulated at much cheaper prices today for their hard-earned cash or coins tomorrow. If you do have some cash or coins, you'll reserve them for crucial purchases, like a life-saving operation.

Poet

sofistek's picture
sofistek
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Posts: 818
PM prices peaked?
ao wrote:

Well, you delayed and delayed and then bought the PMs at near peak prices so ...

Is there a link to an analysis that shows PMs have peaked?

If you mean a short term peak, then you're clearly right (isn't hindsight a wonderful thing?). My point is that it's not a one way street and buying to maintain wealth until you're ready to put more into preparations is risky with PMs, just as it is with some other forms of investment. In my case, if I needed to cash in some of my PMs now, I would lose money relative to having left it in a bank. No-one know what's going to happen in the future but I'd go with Nicole's line that as a very long term (20 years or more) investment, PMs (but especially silver) makes some sense; shorter term, it's almost as risky as anything else.

Tony

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