Moneyweek article, The end of Britain, Economic collapse

[BDG]

(7 January 2013, 17:22)Scythe13 Wrote: You've always come across very well educated, but this reply surprises me a lot.

Starting off like that gives the air of you being very condescending. What did the German Shepard think of your ideas on gold and silver or were you guarding confectionery / pirate money today?

(7 January 2013, 17:22)Scythe13 Wrote: No financial magazine is allowed to give solid advice on what people MUST/SHOULD do.

Please, highlight to me where I said they did or should? If you are responding to me highlighting a very vague time frame, you are constructing a straw man there.

(7 January 2013, 17:22)Scythe13 Wrote: Technically they can, but they're going to get screwed on the legal front (same reason I post 'legal warning' or 'invest on your own research' style things on my financial posts). Telling someone to invest is such a dangerous thing to do, that it's really not worth it. Advice is very different though. What MoneyWeek, and other such magazines do is inform people on their research, understanding, and the alike, then give recommendations for people to look into or about what they think will be good. But they also state that all such investments are done at the risk of the person investing and upon their own understanding, and about how the magazine has no part if the stock/PM/tip ends up failing.

I did not say any different to the above - I did however say that the article was little more than an advertisement for a product - which it is.

(7 January 2013, 17:22)Scythe13 Wrote: As for a GCSE level assignment, I'd be impressed if a kid came up with something like that.

What, that financial collapse = restriction on institutional credit > run on bank > further increase in interest rate > drop in property prices to reflect increased cost of credit and decreased demand > further problems of varying magnitude?

I would be worried if a GCSE business studies student could not fathom that and pad it out in an essay.

(7 January 2013, 17:22)Scythe13 Wrote: Why is it that the richest people on earth are buying into precious metals, while the poorer ones are selling them for "QuikCash" or 'Money4Gold" deals? Because they're idiots and not understanding what is going on in the financial world!!! Here's a quick quote I like "When you find yourself on the side of the majority, it's time to stop and reflect." -Mark Twain. Does that make you think that knocking the Precious Metal holders is a silly thing to do?

The richest people on earth are putting there money in which ever investments their financial planners tell them.

You know what happens when people want to buy gold and silver, or any other finite product for that matter? The price goes up. Do not for one second think they are putting the majority of their money into gold and silver, or hiding it under the bed or burying it in PVC tubes, because they are not.

Look at which nations having been increasing national stocks of gold. Look at which nations are going to struggle the most when the west does not or cannot buy there goods - the gold is there to tide over that country. When it needs tiding over, expect a slump.

(7 January 2013, 17:22)Scythe13 Wrote: As for the above idea of buying a farm, build a barn, stock all the stuff, defend yourself....great ideas. Where are the millions of pounds to do so going to come from? Maybe if you invested in precious metals properly, you'd be able to buy that farm, stock it up, and afford to pay the land taxes levied on you by the government.

How big a farm do you think you will need? You do know with any money you invest in gold and silver, getting a farm now and playing the subsidies game properly will beat any gain on gold and silver? You will have a farm at the end of it. With gold and silver, you sell it for cash, which, due to inflation, may be worth nothing the next day.

(7 January 2013, 17:22)Scythe13 Wrote: In the Great Depression, the PM traders still existed. They were able to make profit.

This is not surprising, the vast majority of trader in all commodities still made a profit - the majority did not go bust - if they had, you would have saw the collapse of society then.

(7 January 2013, 17:22)Scythe13 Wrote: People were buying precious metals at extortionate prices! At one point, you could buy a house for about 82 ounces of silver (that's the lowest figure I've seen in my research, so don't think it's an average). At today's prices, of about $25 an ounce that's $2050, or £1500 (VERY loose conversion to GBP).

You can buy a house with plenty of land in rural America for $25000 NOW. Now, accepting your ghetto maths, accept mine when I say inflation on a fiat currency makes $25000 now worth $2000 then.

So 80 years ago 82 Oz of silver would buy you 10% of the property it buys you now. All it proves is that commodities can be volatile in price and as a long term investment, land and property knock them into a cocked hat.

(7 January 2013, 17:22)Scythe13 Wrote: Remember the Dot-Com boom? People with a website were making BILLIONS nearly over night? Tulipmania where a tulip was selling for around £100'000? People do some crazy things. This latest move to sell all their gold and silver is one of those crazy things.

And the times anyone got rich it were those that were controlling the boom and so could sell at the highest price - once they sell, the arse drops out of it.

Remember that country I was referring to earlier?

(7 January 2013, 17:22)Scythe13 Wrote: I'm happy to be laughed at for having precious metals. Laugh all you want. I've already tripled my money while the market crashed.

So I take it you have sold your metals, for until you sell, you have not trippled anything other than you hold assets to a certain value. All the while you hold them, it is twitchy bum time, as you have to know the right moment to get off the bus.

I would guess that you are not managing a sovereign wealth fund and so are not leading the market, and so are having to judge your getting of the bus before the sovereign wealth fund does.

Maybe you will be clever, or lucky or sensible and sell up sooner rather than later, but the vast majority of the small men never do, and it is they who get stung.

(7 January 2013, 17:22)Scythe13 Wrote: I'll continue to hold the metals for a while, then cash out when I think the time is right. Then I'll buy a farm, build a barn, legally defend myself, etc. Then you can tell me how expensive precious metals are and how they're a great investment. Follow the flock, and get ready for the crash of the PM-boom. Guess what I'll do when the prices tank and drop? I'll start buying back at a HUGE discount! BARGAIN!!!

If you get off the bus in time. Then you will have to convert your metal to money and your money to goods and assets and here you run into problems of the things you cannot control - the value of your metal, restrictions on use of capital, abundance of land, quality of land, cost of land, abundance of goods, cost of goods &c.

Then you are going to have to learn to farm, look after stock and defend land in what could be pretty hostile times.