This is in response to a top contributor's response on PM investing. The first paragraph is from the Yahoo Answers top contributor, and the 2nd is from a wealthy PM investor. What do you think about these responses. Thank You kindly.
(joeyV)
What are you trying to accomplish?
First off there are only three (or perhaps four) precious metals that are traded - gold, silver, platinum and possibly palladium. Copper is not a precious metal ($3/lb) so anybody who is telling you that copper is a precious metal is an idiot and not worth lstening to for more than time of day. Buying any other metal besides these is deeply nuts unless you are a pro buying an enormous pile.
Second, all of these are wildly volatile investments. Buying them as your primary investment is nuts.
Third, buying them "long-term" is just stupid - they have been going down steadily in value for 1000 years. The recent blip up is a blip unless you believe that a 1000 year trend has reversed for some whacko reason (all the reasons are wacko - like Armaggedon is going to happen and kids with bags of silver are going to save the day).
Edit: If you really want to make money, you will bet me that you know more about economics or economic history than me. I'll bet $1000 at 100:1 odds. If you think the US is anything like Weimar,then you know nothing and shouldn't be managing your own money. Ditto for Greece. Neither of those countries was remotely in control of their own money - Greece because it was a small insignificant country with an external currency and Weimar because of the wildly oppressive treaty of Versailles that let them keep nothing. Inflation is very healthy if kept at a reasonable level. US inflation is very light and healthy. The Fed has a $3T balance sheet. $3Trillion. That's $3,000,000,000,0000. That is wildly different from Greece or Weimar where their central banks had nothing. If you don't know how the size of a central bank's balance sheet affects their ability to control inflation better go read up.
In the meantime - about that bet? Let's do it - you could make some good money if you knew something.
Response: Mr. Vess
This was my perception as well. You meet people like this once in a while. People who are so strong headed they can convince themselves to believe anything they want to believe and say it's fact. They always have something to prove or one up somebody on.
There is no doubt the US had/has the benefit of being the largest, most prosperous country in the history of mankind. Just because it takes a much larger number before all of it's equity is burned up, doesn't mean it can't turn into a Weimar situation. If inflation is so good, why don't they print enough money to pay off every debt and buy everything that everybody needs right now? Bail all the states out and every business. Problem solved in his eyes!
A stable money supply should experience zero inflation. We are relying on infinite, compounding growth to keep the wheels turning. It's impossible. We're seeing the limits tested with the job markets right now. 1 in 2 college students can't find a job. If 50% of them are unemployed, how are the "lowly" blue collar workers doing? So we have a severe economic downturn with a huge drop in tax revenue, but the governments budget keeps skyrocketing by default because it has to! Whether the money is coming in to pay for anything or not, really doesn't matter any more..
When George Washington took office the country had very little debt if any.
When George Bush I took office, the country had accumulated a paltry 1 trillion in debt. (Took how many centuries and how many wars??)
When Obama stepped into office we were at 9 trillion.
Today we're at 16 trillion. This isn't even counting unfunded future liabilities.
This isn't " light and healthy inflation". This is essentially a runaway train, picking up speed. I'm sure if the government tells him inflation is 0% he would believe it no matter the situation.
Unless the powers that be create and institute new math at some point, I can't see how this ends well. Nothing less than new math will save this system and if it does, the little guy will still get screwed.
That clown has his head in the sand. Wishful thinking. He's willing to make a bet that 'maybe' nothing will happen in his lifetime. Well, maybe so. It doesn't mean he's a fountain of knowledge on the future of economics. He actually seems naive.
(joeyV)
What are you trying to accomplish?
First off there are only three (or perhaps four) precious metals that are traded - gold, silver, platinum and possibly palladium. Copper is not a precious metal ($3/lb) so anybody who is telling you that copper is a precious metal is an idiot and not worth lstening to for more than time of day. Buying any other metal besides these is deeply nuts unless you are a pro buying an enormous pile.
Second, all of these are wildly volatile investments. Buying them as your primary investment is nuts.
Third, buying them "long-term" is just stupid - they have been going down steadily in value for 1000 years. The recent blip up is a blip unless you believe that a 1000 year trend has reversed for some whacko reason (all the reasons are wacko - like Armaggedon is going to happen and kids with bags of silver are going to save the day).
Edit: If you really want to make money, you will bet me that you know more about economics or economic history than me. I'll bet $1000 at 100:1 odds. If you think the US is anything like Weimar,then you know nothing and shouldn't be managing your own money. Ditto for Greece. Neither of those countries was remotely in control of their own money - Greece because it was a small insignificant country with an external currency and Weimar because of the wildly oppressive treaty of Versailles that let them keep nothing. Inflation is very healthy if kept at a reasonable level. US inflation is very light and healthy. The Fed has a $3T balance sheet. $3Trillion. That's $3,000,000,000,0000. That is wildly different from Greece or Weimar where their central banks had nothing. If you don't know how the size of a central bank's balance sheet affects their ability to control inflation better go read up.
In the meantime - about that bet? Let's do it - you could make some good money if you knew something.
Response: Mr. Vess
This was my perception as well. You meet people like this once in a while. People who are so strong headed they can convince themselves to believe anything they want to believe and say it's fact. They always have something to prove or one up somebody on.
There is no doubt the US had/has the benefit of being the largest, most prosperous country in the history of mankind. Just because it takes a much larger number before all of it's equity is burned up, doesn't mean it can't turn into a Weimar situation. If inflation is so good, why don't they print enough money to pay off every debt and buy everything that everybody needs right now? Bail all the states out and every business. Problem solved in his eyes!
A stable money supply should experience zero inflation. We are relying on infinite, compounding growth to keep the wheels turning. It's impossible. We're seeing the limits tested with the job markets right now. 1 in 2 college students can't find a job. If 50% of them are unemployed, how are the "lowly" blue collar workers doing? So we have a severe economic downturn with a huge drop in tax revenue, but the governments budget keeps skyrocketing by default because it has to! Whether the money is coming in to pay for anything or not, really doesn't matter any more..
When George Washington took office the country had very little debt if any.
When George Bush I took office, the country had accumulated a paltry 1 trillion in debt. (Took how many centuries and how many wars??)
When Obama stepped into office we were at 9 trillion.
Today we're at 16 trillion. This isn't even counting unfunded future liabilities.
This isn't " light and healthy inflation". This is essentially a runaway train, picking up speed. I'm sure if the government tells him inflation is 0% he would believe it no matter the situation.
Unless the powers that be create and institute new math at some point, I can't see how this ends well. Nothing less than new math will save this system and if it does, the little guy will still get screwed.
That clown has his head in the sand. Wishful thinking. He's willing to make a bet that 'maybe' nothing will happen in his lifetime. Well, maybe so. It doesn't mean he's a fountain of knowledge on the future of economics. He actually seems naive.