My 2010 position in Silver Wheaton brought gains of 100%, give or take a few dollars. I also had a small position in Premium Exploration which i thought had great potential as a gold exploration company. Their properties seemed to be extremely valuable but I sold my position at the end of the year for just a slight gain, which turned out to be a bit soon. Over the following weeks the stock did a major run up in price which would have been nice, but now it sits just about where i sold. The reason i sold my positions at the end of the year was so that i could switch from paper precious metals investments to physical metals investments. My research throughout the year taught me alot about the nature of our crisis as compared to other crisis's suffered by the US and other nations throughout history. I learned about the transfer in wealth from cash to tangible assets like gold and silver. So at the beginning of the 2011 year i purchased a 100oz bar of
.999 fine silver for $30 an ounce and paid $100 for shipping and insurance. In 2010 I started with $1600 which i doubled to just about $3200 by december. I then purchased the bar for $3100 and later two small 1oz bars for just under $100 with shipping.
Less than 3 months after my purchase silver was riding $50oz. Thats a gain of 62%.
During these summer months the price of silver has been beatin back by a combination of massive commercial shorts, in an effort to supress the price, and the natural summertime selloff which happens nearly on cue every year. Notoriously the fall and spring months are best for precious metals while the summer is usually the slowest.
I do expect that by years end we'll be back up near the $50 price range.
Sunday, June 26, 2011
Late June, 2011
God its been a long time since i've been here. Its quite interesting to read over my postings from almost 2 years ago. I find it invigorating and motivating to see how passionate i was about investing and expanding my knowledge. I'm happy to report that some of my thoughts were on the money, and that my early research was in the right direction. Though i can say i was wrong about some things. So here i am nearly 2 years later in front of my computer sharing my thoughts about investing.
What i've learned since my last post is this... investing is alot like the game of poker. Why do you think so many of the same people reach the finals table every year? because their the luckiest people on earth? No, its because its a game of skill.
There are thousands of people out there on tv or in magazines that give their opinion everyday. Most of them couldnt be more wrong. Its like a doctor telling a cancer patient that they must start chemo and radiation as soon as possible, without understanding that chemo and radiation are actually proven not to work. Almost every doctor in the country responds to cancer with that same advice, because thats what they grew up knowing and thats what they learned in school, and thats what rakes in billions of dollars every year. Its those people out there getting ridiculed on tv for saying something against the grain. For the most part, those are the people who have an actualy understanding.
Something I learned when i was young is that most people dont really know whats going on.
" the reason the rich get richer, the poor get poorer and the middle class just struggles with debt is because financial education takes place at home, not in school." Robert Kiyosaki
How true! and i wonder why the very essence of financial success has never entered the public classroom? What is it that seperates the rich and the poor and middle class? its the understanding of investing! I told this to some friends of mine over a drink at the local bar and they seemed extremely interested in what i was saying (i mean who doesnt want to have money). About 2 weeks later one of them approached me, very excitedly, and said that he had taken me seriously and he had begun investing. He said "ya i've started a roth IRA, and im going to start putting in a $100 a month and hopefully double my contributions every year". I should have told him it was a horrible idea; maybe i will when i see him next. That is not investing. The point of investing is that at the end of the year you've generated income with minimal personal involvement.
"when your yearly income derived from investments is enough to cover your yearly living expenses with some left over for growth, you are wealthy."
Anyway, the point of the story is that saving us currency at this point is like saving an ice cube for later. The rate of inflation of the currency supply is only escalating. It took 200 years for the US to create $825 Billion in paper money;known as the currency supply. Since 2009 the currency supply has increased to over $3 trillion.
Thats and expansion of nearly 4 times. Below i've posted a video which shows the calculations of some austrian economists who have actually figured out mathematically the "point of no return" in the case of a failing economy.
As you'll see, we're well past "the point of no return". There are really only 2 options for us now and neither have the best interests of the "savers" in mind.
However, for those that are prepared and educated, this will be an extremely profitable time.
The Point of No Return: Part 1
The Point of No Return: Part 2
What i've learned since my last post is this... investing is alot like the game of poker. Why do you think so many of the same people reach the finals table every year? because their the luckiest people on earth? No, its because its a game of skill.
There are thousands of people out there on tv or in magazines that give their opinion everyday. Most of them couldnt be more wrong. Its like a doctor telling a cancer patient that they must start chemo and radiation as soon as possible, without understanding that chemo and radiation are actually proven not to work. Almost every doctor in the country responds to cancer with that same advice, because thats what they grew up knowing and thats what they learned in school, and thats what rakes in billions of dollars every year. Its those people out there getting ridiculed on tv for saying something against the grain. For the most part, those are the people who have an actualy understanding.
Something I learned when i was young is that most people dont really know whats going on.
" the reason the rich get richer, the poor get poorer and the middle class just struggles with debt is because financial education takes place at home, not in school." Robert Kiyosaki
How true! and i wonder why the very essence of financial success has never entered the public classroom? What is it that seperates the rich and the poor and middle class? its the understanding of investing! I told this to some friends of mine over a drink at the local bar and they seemed extremely interested in what i was saying (i mean who doesnt want to have money). About 2 weeks later one of them approached me, very excitedly, and said that he had taken me seriously and he had begun investing. He said "ya i've started a roth IRA, and im going to start putting in a $100 a month and hopefully double my contributions every year". I should have told him it was a horrible idea; maybe i will when i see him next. That is not investing. The point of investing is that at the end of the year you've generated income with minimal personal involvement.
"when your yearly income derived from investments is enough to cover your yearly living expenses with some left over for growth, you are wealthy."
Anyway, the point of the story is that saving us currency at this point is like saving an ice cube for later. The rate of inflation of the currency supply is only escalating. It took 200 years for the US to create $825 Billion in paper money;known as the currency supply. Since 2009 the currency supply has increased to over $3 trillion.
Thats and expansion of nearly 4 times. Below i've posted a video which shows the calculations of some austrian economists who have actually figured out mathematically the "point of no return" in the case of a failing economy.
As you'll see, we're well past "the point of no return". There are really only 2 options for us now and neither have the best interests of the "savers" in mind.
However, for those that are prepared and educated, this will be an extremely profitable time.
The Point of No Return: Part 1
The Point of No Return: Part 2
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