Letter Re: Why Precious Metals?

I think that you are off base when it comes to buying guns and precious metals. Both could go down in price. The same for ammo. And it has a shelf life. So why not buy stock in companies that that do well in both good and bad times? People always buy booze, and cigarettes and Pampers and Cheerios. So why not invest in the companies that make those? What is so [deleted] special about “tangibles”? Thanks For Your Time, – G.D.C.

JWR Replies:

First, I must mention that ammunition has a shelf life of at least 60 years, so I don’t consider that an issue. Just be sure to store it in watertight milsurp ammo cans and toss a small packet of desiccant in each can. It will store just fine, for generations.

Now on to your main point: I don’t recommend any dollar-denominated investments because presently the currency unit itself is at risk. People face the prospect of losing almost everything that they’ve earned if there is a transition to mass inflation. The U.S. money supply has been created in a near upright spike since 2008, and the public debt doubled in the same time period.

Buyers of silver and other precious metals can feel content for nine distinct reasons:

First, you are sheltering your wealth from the ravages of inflation. No matter what happens to paper currencies, your metals will always hold some value
Second, you are buying something liquid and instantly marketable
Third, you are buying something that is easily divisible. If for some reason you can’t trade it for smaller increments, there is always the cold chisel.
Fourth, you are buying privacy. If you pay cash, there will be no paper trail.
Fifth, you are buying a useful tangible item.
Sixth, you are not buying someone else’s liability.
Seventh, (for gold an platinum only) you are buying transportability. Precious metals trade in every nation. A million dollars in gold will fit in just a briefcase. (Albeit heavy.) But silver is about 65 times more bulky, per dollar.
Eighth, if you store you metals in a home vault or cache, you aren’t at risk of losing your investment because of someone else’s mistake. Companies rise and fall. So do currencies. So do banks. So do governments. But precious metals are just about impervious to all of that.
Ninth, because the money multiplier effect works in reverse whenever you withdraw cash from your bank account then you will help starve the banksters of their power.

All in all, I am very happy with how my investments have fared, since I switched to all tangibles. My ranch has only appreciated about 20%, but my silver has nearly quadrupled, and most of my ammo has tripled in value. Most of my guns have more than doubled in value.

Obviously tangibles investing is not for everyone. A pensioner that need interest or dividend income would not do well. But for most folks tangibles are a fine investment. Just keep in mind that ammunition and storage food must take precedence over investing in precious metals. – J.W.R.