View Full Version : What If...

24th June 2008, 16:43
It's all exploding around us now? I started checking out what people DO as far as investing, and I found one thing we all are LEAD to do that in the end doesn't make any sense - no matter how much fiat paper we have to invest!

Seems all investments EXCEPT physical silver (or PM) holding have some sort of lead time where you have to hold your certificate before it matures and you can sell. This holding is above and beyond what you'd do if you just bought physical. This kind of investing puts ANOTHER time frame on your own investment time frame! Buying physical - YOU set the time frame and based on economic conditions you buy or sell more often. Either way.

The stock market has made it cheap enough for people to invest in lots of different instruments. Even stocks that would be considered a hedge! (until this year anyway.) How can a stock be a hedge against the stock market crashing? If you are already invested in stocks, the money there has to GROW first before you can take profit and move on to another instrument. Your original money invested would have to GROW to be able to move forward.

Many of the members of this forum invest in futures and more sophisticated instruments than mutual funds in the 401K. Like people who regularly trade on the Basis - (today silver's at something like .18 contango). The margins are so tiny, you'd need another professional involved in the trading process to lessen your risk while your trading. Remember the comments from people who posted them after the Barclay's ETF story regarding the true holdings of the silver pool account for ETFs? The other professonal creating a contango event is like a security for your basis trade!

What if - printing fiat money was simply just a way to get the ball rolling for any investment vehicle? You'd need to sell many instruments to create demand for profit to occur! Like mortgages for example: it's legal for a bank to use a small amount of money to generate enough loan business to pay for the loan product, the mortgage on the bank's buidings, people's salaries, etc. But before all that got going there was really just this small amount of seed money to be able to offer the mortgages? Remember it's legal for a bank to use $8 million dollars to write $550 million dollars in loan business. Technically, when a metal backed ETF gets new contracts the bank is supposed to go out and buy more metal to keep the ratio to share rate they started with. Do any of you BELIEVE there really is a 10 oz per share ratio still in place despite the amount of ounces held in a pool account for any ETF?

What if we're all 'going through the motions' the growth from value isn't there - the growth comes from volume?