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steveoc
25th May 2010, 11:05 PM
Anecdotal twiddle from today ....

I generally keep my cash reserves low. I used to spend a ridiculous amount of each paycheck on stupid things, and eventually I worked out that the best way to manage things is to invest a certain amount of each paycheck first, pay my bills next, and then leave a little bit left over to live off each week.

Investing - in the form of sticking cash away, never worked, because it was too easy to crack open the piggy bank if the night was going well, and enjoy the proceeds. PM's on the other hand, well you cant easily raid the PM stash at 2am and trade it in for something worthless or consumable.

That has gone well since I took up stashing PMs. My little nest egg has grown ridiculously well, and I have put away far more than I have ever been able to in the past with other forms of investment. They are beautiful and shiny, and they make you feel a real sense of achievement. Not something you can easily cash in without serious forethought.

Anyway .... this week, a whole lot of things have come up, Ive put down for some big new purchases that are coming in soon, paid out some unexpected bills, and also reached into my wallet to help out a friend in dire need.

And then some more bills hit ... and now, I find that I have something less than $20 actual cash to get me through to next week. Whilst I CAN live on $20 for a week, its not ideal. Just means I have to crawl into the corner and not eat much for a week !

Well, thats silly I thought - I have enough PM's in my stash to afford a trip to the fricken moon, so why should I go without food for 5 days ?

Reluctantly, I went through my stash and picked out the worst 10 oz of silver rounds that I could muster, and went for a pensive stroll down to the coin shop / exchange jeweller. Ive NEVER sold any PM's before, so I felt like a complete dag going in there to trade in some dirty old ounces of silver, rather than walk in as a buyer. Was expecting half of them to be rejected, or undergo the third degree about where I got them, or fill in 10 pages of paperwork explaining why I was holding fine silver. In the best case, I was expecting a huge haggling session as they might offer half of spot for the ounces. Sort of like going into a pawnbroker and trying desperately to trade in your old guitar for a fair price.

No problems - friendly staff, she looked at the coins quickly carefully, filled in a small form, and then reached into the cash draw with a smile and counted out the money "There you go Sir .. spot price today is $21.8 (AUD), we are buying at $21.5, so we are happy to offer you $215 for these ... is that OK ?"

That equates to a USD spot price of around $18 - so yeah, of course Im happy with that.

They didn't even weigh them or test them in any way - she held each one for feel and read the label.If it says "one troy ounce .999 fine silver" on the label, then its good enough. Honest money for honest people ! I love it.

Didnt have to queue up, didnt have to sign any form, didnt have to show ID ... so much better than going to a bank. Not to mention I made profit on those 10 over what I paid for them. And I love the way that when selling PM's - as the holder of the PM, you are the one with the negotiating power, not the buyer. "we are happy to offer you $215 for these .. is that OK?". Imagine a Bank asking you if their offer on your paper investment you are cashing in is OK by you ? .. bah, that will never happen.

So there you go. Moral of the story for me - is that having never actually sold any PMs ever, I have always had a fear in the back of my mind somewhere that trading ounces of PMs in "times of need" may not be that simple. Whilst I HATE being in this situation, albeit temporarily for a few days .... I am really glad that I did it, because now I know for a fact that these little shiny things have a real power and value of their own.

If you have always hoarded, and never want to sell - at least go through the exersize of selling a small amount at least once, so you can feel super comfortable with the process should you ever need to do it in the future.

In fact, I cannot think of a single thing in this world that you can sell easily quickly for cash without any hassle for a fair non negotiable price that you expect up front, except for PMs.

jedemdasseine
25th May 2010, 11:13 PM
Good that you now have experience selling.

I'm sure the board will have some opinions on this or that aspect of selling metals, but I'll leave it to others to chime in.

Suffice it to say I never get tired of hearing stories like yours.

Thanks for sharing.

1970 Silver Art
26th May 2010, 04:30 AM
I have sold gold and silver in the past and I used most of the proceeds to buy silver art bars that I was looking for to add to my silver art bar collection. I used to have Engelhard Prospectors, 10-oz silver bars, SAEs, and 1-oz JM silver bars but once I started becoming a serious silver art bar collector in August 2008, I sold ALL of that and used the proceeds to buy silver art bars. I have also sold some silver art bars that I either did not want or were duplicate purchases and used those proceeds to buy silver art bars that were on my '70's silver art bar "wish list".

What I currently do now is that I just save cash. I prefer to save cash just in case I need to pay some unexpected expenses and I also save cash for things that I plan to do in the future. For example, If I know that I am going to go to a coin show in a few months, then I will also put aside some cash just for that coin show.

I also find that when I buy PM's, then I do not spend nearly as much on "stuff". Buying PMs has changed my spending habits.

k-os
26th May 2010, 05:20 AM
Thanks for the story, stevoc. Glad to know that it went well for you.

I've never had to sell any metals, but I have thought that I would have to . . . I've cut it pretty close.

My friend's husband has told me he'd buy up to a few ounces of gold if I needed the cash. So I rest comfortably knowing that I have a buyer who is also a friend.

Anything more than that, I'd probably sell it back to the same dealer that I have bought from in the past.

Sparky
26th May 2010, 05:13 PM
steveoc, that is an excellent anecdote; thanks for sharing. I totally agree with your advice:

If you have always hoarded, and never want to sell - at least go through the exersize of selling a small amount at least once, so you can feel super comfortable with the process should you ever need to do it in the future.

As a matter of fact, one could almost consider this a prep exercise. I always have the impression that a large fraction of hoarders have never sold. I have sold very little myself, but never had a problem. I remember at one point early on needing to be convinced of PM liquidity by a dealer. I've always encouraged "sell stories". And to be fair, some of the stories are not as smooth. I think it's helpful to hear as many of these as possible.

Thanks again for sharing.

Trinity
26th May 2010, 06:35 PM
I have sold and received ready cash 123. The only problem I had was the dealer gave me a look like I was one dumb ass for selling the stuff. I actually thought I was going to have it out with him at one point.

TLM
27th May 2010, 06:01 AM
Good story Steve.
I'm glad you could painlessly liquidate them when you needed cash.

PM's did what they were supposed to do, amass wealth and security
in good times and a provide a safety net for lean times ;)

Peace
TLM