How much silver do I need?

[ximmy]

The boating accident left me with a couple ounces... ::)

I've been thinking of paying down the home this coming year or... keep stacking???

I know your boat sank too... but just as a thought... How much silver should one accumulate???

[zap]

Don't take my advise ximmy, but if gold comes down a bit I might buy my first ounce.:) wouldn't want to get crazy with silver though, maybe 1/2 and 1/2.

It depends on how much you owe and what the rate is?

[ximmy]

Don't take my advise ximmy, but if gold comes down a bit I might buy my first ounce.:) wouldn't want to get crazy with silver though, maybe 1/2 and 1/2.

It depends on how much you owe and what the rate is?


zap, IMO you should buy an ounce or two right now!!!!
once it passes 2g it's not coming back. I have some for state payoff or ransom purposes, no intention of selling.

my rate is 5 but I hate paying interest... it's so evil

[Sparky]

I think the real answer is going to be like the old joke: If my friend and I are being chased by a bear, how fast do I need to be to escape? Faster than my friend.

I think 3 targets are:
1) To get by, own more than whatever 50% of the population owns.
2) To be well off, own more than 90%
3) To be wealthy, own more than 99%

As of today, what are these numbers? Assuming there is some basic amount of people own "accidentally" through jewelry, inheritances, coin collectors, silverware, etc., perhaps the median American owns 25-50 ounces. To be in the top 10% you probably need 500 ounces. Top 1% you probably need 5,000 ounces. These are wild-ass guesses; feel free to suggest your own.

As things progress, the bottom half will probably creep up such that at some point the median amount might be 100 ounces. (This is what will cause the price to increase.)

As a relevant piece of information, I think the purchasing power will increase with time according to the following schematic, with the uncertainty being how far right we will move along the x-axis with time:

1841

[zap]

zap, IMO you should buy an ounce or two right now!!!!
once it passes 2g it's not coming back. I have some for state payoff or ransom purposes, no intention of selling.

my rate is 5 but I hate paying interest... it's so evil

LOL ximmy :)

[ximmy]

LOL ximmy :)

In these strange days a girl has to take full command of her own virtue... and of those who she loves... :p

[zap]

Oh Ximmy I wasn't laughing at you.

I was laughing at what you don't know about me.

[ximmy]

Oh Ximmy I wasn't laughing at you.

I was laughing at what you don't know about me.

I feel for your boating accident loss too... ;D:p:D

[Dogman]

Oh Ximmy I wasn't laughing at you.

I was laughing at what you don't know about me. Woman of mystory!
http://24.media.tumblr.com/tumblr_ktwrucmw3D1qa3op2o1_500.jpg

[Sparky]

Another way you have to look at this in terms of measuring wealth:

We convert PM ounces to FRNs so that we can understand purchasing power. So right now, 100 oz silver = roughly 3,000 FRN.

So as of today, someone with 100 oz and 2,000 FRN has the same purchasing power as someone with 5,000 FRN.

If the FRN price of silver doubles, the silver owner has the purchasing power of 8,000 FRN, while the non-silver owner still has 5,000.

But an important reminder about "wealthy": If silver goes to 1000 FRNs per ounce, the silver owner would have purchasing power of 102,000 FRN, and the non-silver owner will still have the purchasing power of 5,000. But someone with no silver and 1,000,000 FRNs will still have more purchasing power than the silver owner! So be careful not to kid yourself about becoming "wealthy". As you move to the right, the silver owner gains steadily on the non-silver owner, but may never catch those who are currently wealthy in FRN terms.

And if we ever do get to the SHTF part of the curve, then we have to re-evaluate everyone's wealth by bringing food and water and other tangible resources into the equation, which would dramatically re-shape the wealth curve.

[Joe King]

The boating accident left me with a couple ounces... ::)

I've been thinking of paying down the home this coming year or... keep stacking???Can you do some of both? If you think we won't be facing TEOTWAWKI in the next years, paying down principle would save you tons of interest over the course of the loan and if the World don't end, you stack more with that $ then.
...and if it does, an extra month or two payment per year won't have been too much $ in vain.



I know your boat sank too... but just as a thought... How much silver should one accumulate??? How much can you carry? If you think you could ever have to bug out, you have to be able to carry it. Silver adds up quick, weight wise.
Or, how much are you gonna want to sell on the way up so you might realize a profit?
ie if we ever really have a real hyper inflation, a few spare coins could pay off all your debts.

What Sparky posted sounds good too.

[mightymanx]

I am a history geek amongst other things. I have used that to come up with my silver usage SWAG*

I figure in an honest money society like days of old a usage rate of one ounce per day to maintin poor quality of life without debt. 5 ounces to maintain well off status.

What I have in todays purchasing power with one ounce ? That gives me 30ish bucks a day/ 900 a month to buy food nails, fuel, what not. Not much when the hollidays roll around or you have to start paying for things like electricity book clubs etc.

5 ounces gives me 150ish a day in purchasing power or a monthly income of 4500 much nicer.

This is just for "quality of life usage" the purchasing power of metals has remained fairly constant throughout the ages.

Gold would be for major purchases in this senario, land, vehicles, women ;) etc.

So the gold buys the place silver maintains it.

Now how long do you want to live like that without having to earn income?

Then I can get an answer to how much.






*Scientific Wild Ass Guess

[ximmy]

Can you do some of both? If you think we won't be facing TEOTWAWKI in the next years, paying down principle would save you tons of interest over the course of the loan and if the World don't end, you stack more with that $ then.
...and if it does, an extra month or two payment per year won't have been too much $ in vain.


How much can you carry? If you think you could ever have to bug out, you have to be able to carry it. Silver adds up quick, weight wise.
Or, how much are you gonna want to sell on the way up so you might realize a profit?
ie if we ever really have a real hyper inflation, a few spare coins could pay off all your debts.

What Sparky posted sounds good too.

1. thinking 6 extra payments a year...

2. it's already overbearing (to the point of major fear)

[ximmy]

I am a history geek amongst other things. I have used that to come up with my silver usage SWAG*

I figure in an honest money society like days of old a usage rate of one ounce per day to maintin poor quality of life without debt. 5 ounces to maintain well off status.

What I have in todays purchasing power with one ounce ? That gives me 30ish bucks a day/ 900 a month to buy food nails, fuel, what not. Not much when the hollidays roll around or you have to start paying for things like electricity book clubs etc.

5 ounces gives me 150ish a day in purchasing power or a monthly income of 4500 much nicer.

This is just for "quality of life usage" the purchasing power of metals has remained fairly constant throughout the ages.

Gold would be for major purchases in this senario, land, vehicles, women ;) etc.

So the gold buys the place silver maintains it.

Now how long do you want to live like that without having to earn income?

Then I can get an answer to how much.

*Scientific Wild Ass Guess

I'm thinking I need to swap to gold... :'(

[mightymanx]

I'm thinking I need to swap to gold... :'(


I was at the same realization with my theory.

Then I got divorced, now I don't have to worry about silly things like precious metals.:mad:

[Dogman]

I'm thinking I need to swap to gold... :'( As said silver has great potential, but much weight for the value. Gold packs the max value with the less weight. If I would do it today buy silver and stack then when there is enough silver,swap it for gold, rinse and repeat. That way you would have silver, but most will be gold, easier to step down than up. IMO.

[Sparky]

I am a history geek amongst other things. I have used that to come up with my silver usage SWAG*

I figure in an honest money society like days of old a usage rate of one ounce per day to maintin poor quality of life without debt. 5 ounces to maintain well off status.

What I have in todays purchasing power with one ounce ? That gives me 30ish bucks a day/ 900 a month to buy food nails, fuel, what not. Not much when the hollidays roll around or you have to start paying for things like electricity book clubs etc.

5 ounces gives me 150ish a day in purchasing power or a monthly income of 4500 much nicer.

This is just for "quality of life usage" the purchasing power of metals has remained fairly constant throughout the ages.

Gold would be for major purchases in this senario, land, vehicles, women ;) etc.

So the gold buys the place silver maintains it.

Now how long do you want to live like that without having to earn income?

Then I can get an answer to how much.






*Scientific Wild Ass Guess

MM, I like your idea of trying to convert it to daily purchasing power.

A couple of comments...

Your original premise implies (which you clarify at the end) that you aren't making any income, but rather just spending your wealth daily. So you've presented a worst case scenario. But you've also shown that by today's FRN standards, holding a moderate amount of silver certainly doesn't make you wealthy, but my point is that you would slowly climb the wealth curve as the FRN conversion rate increases. But you may never really be "wealthy", but rather simply in much better shape than if you did NOT hold silver.

Second, we hear that the purchasing power of metals has remained constant over the ages. However, it does not remain anything NEAR to constant over a single lifetime! In the last 50 years, a mercury dime could have bought you anywhere between 0.5 and 3 gallons of gasoline! That's a 6x difference in purchasing power! The constancy only shows up when we compare it to the FRN. Over the same 50 years, one FRN has been able to buy anywhere between 0.25 gallons and 10 gallons, which is a 40x range! And in 100 years, the mercury dime will probably still be in the 0.5 to 3 gallon range, whereas the dollar might not even buy 0.01 gallons.

[mightymanx]

I agree it is near constant to the FRN but without the "dollar" I feel it will do the same. The gold to suit ratio is still fairly constant though if you look throug last centuries Sears catalogs. that one still holds fairly strong.

the problem comes from a math problem with 3 variables.

Cost of goods absolute (which is not really possible compounding the the problem.)
Purchasing power of PM's
Purchasing power of FRN's


When a candy bar costs a price we are programed to think in US currency so the candy bar costs a dime in 1918 the "price" goes up well the cost of material is priced in FRN's and the end product is sold in FRN's so that works. The FRN to PM also works because the dime was silver.

Now that FRN and metal are not tied directly at any fixed ratio they both vary. so now we have two unassigned variables trying to pin a cost of a product.

I could not make that math ever work

So I looked at what gold/silver bought during history chickens hershey bars suits etc.

Yes a hershey bar cost a dime back in the day, and that dime was silver, but a gallon of gas was also a dime. YOu could get the blue plate at the dinner for a dime.

What is that dime worth today? Lets pick 25 times face value so that dime is now worth 2.50

2.50 will get you several hershy bars, won't buy you a meal of the same quality as then (Dollar menu yes), Nope to gallon of fuel (Close but not quite).

So what variable affected that?

Cost of goods absolute
FRN variation
PM variation

I figure it is a combo of all 3

This is the tail chase I got into trying to be exact. Because the dollar is being inflated the cost of goods is priced in FRN's so is Silver and Gold.


Pm's are is always going to have purchasing power, untill FRN's are gone and cost of goods is directly priced in silver and gold I think a perfect relation formula is imposible. This is why you dont pay your tax bill in silver at face value you want the FRN conversion right up until it goes away for good.

So I simplified

A ounce of silver will buy me 30 bucks of shit right now. Can I live on 30 bucks a day at todays prices?

What did an ounce of silver buy in 1711, 1811, 1911 goods got cheaper as technology made it cost less. But I could live on an ounce of silver a day in each of those times if I had no debt and a place to live.

Now 2011 what can an ounce of silver buy? Well it buys about 30 bucks worth of stuff at current FRN prices. can I live on that?

Yes I could if I had no debt and a place to live.

I will never get rich buying now and holding for a pure PM society. at best I will preserve what I can buy at the instant I converted FRN's to PM.

the time for proffits is right before the dollar dies and PM's are "to the moon" and you buy as much durable goods and land as you can during that time. Then wait untill the other side of the dollar death and enjoy your material wealth.

Then it is possible you could live quite well on a ounce a day. While others will trade their labor to get silver for your land usage and durable goods.

That is the detailed version of my SWAG anyways

Hope it made sense.

[Joe King]

1. thinking 6 extra payments a year...

2. it's already overbearing (to the point of major fear)

I'd say that if you were planning on 6 extra payments per year, you'd be pretty sure you're actually going to be there for awhile. Because if you are truly concerned you might have to leave, anything extra you spend on payments is like throwin' $ away.
$ that would have been better spent on preps.

If I were truly concerned I might have to walk/drive away from everything with only what I could carry, but still wanted to hedge by bets, I'd make 2 maybe 3 extra payments per year at most if I could afford it.

That way it'll free up cash for other preps you might feel more comfortable having now and if things actually do start turning around, then you can devote even more to extra payments, due to feeling more secure in your location for the long term.
Even at the rate of only two extra payments a month, you'll take years off the end of the loan, thereby saving you thousands.

[undgrd]

Since the original post indicates a desire to pay down the mortgage, I would have to ask...why?

Most (all) mortgage agreements have a clause that allows the bank to call in the loan. They give you a specific amount of time to payoff...yes PAY OFF...the balance or lose the home. Regardless of the interest rate, if you don't have the cash on-hand to satisfy the banks request, you'll lose the house and those extra payments. You might get lucky and be able to buy it back in auction for less than you owed...but I doubt it.


My advice? Stack the percentage of your yearly take home that makes you comfortable. Keep the rest in cash. When you have enough cash to payoff the house, pay it off if you like. You'll lose your tax benefit from the interest, but it'll be paid off.

Of course...nah...you probably don't want to hear about the yearly property taxes due, eminent domain, or the county/state ability to simply raise the taxes to an unsustainable level.

[Horn]

Leave the house for the resulting Detroit,

Build a suit of armor out of the silver, hop on solid's boat and become a Atlantean missionary.

[Twisted Titan]

Keep paying the mort as agrreed hold any extra in physical cash.

There is too much that is unwritten on what will become of "private "property in the coming years

To stave off revolution a debt jubliee on housing is not out the realm of possiblity.

Those that were responisble and played by the rules will be left to pound sand and hopefully not lynched mobbed by the unwashed masses.

Just remain vigilent and watch which way the wind bellows.


Hold physical cash and wait till the moment presents itself

[Horn]

Keep paying the mort as agrreed hold any extra in physical cash.

If there is a reward for honoring contracto del diablo, it will be illuminating.

[Silver Rocket Bitches!]

Your mortgage debt will become diluted as inflation ramps up. Silver will become economically harder to come by as inflation increases and silver's monetary role increases.

If your payoff is, say, $5k you could pay off your house right now for ~172 ozt of silver @ $29. If silver goes to a conservative $50, your payoff is now 100 ozt of silver.

I say keep stackin.

[madfranks]

Great analyses, Sparky. And I agree with SRB, stack the silver while it's cheap.

[palani]

Only keep as much silver as necessary. That would be $21 face value total in 90%. You use it to fund a bond. You offer the bond to anyone who wants to force you into a business arrangement.

My bond requires that the 1971 Truth in Lending Act be adhered to and that my signature with a seal be used to collect the bond.

If they accept it then you have a contract.

[StreetsOfGold]

3) To be wealthy, own more than 99%

Based on this, some of us will be the NEW 1%

[ximmy]

I guess I'll keep stacking in 2012...

[Twisted Titan]

Your mortgage debt will become diluted as inflation ramps up. Silver will become economically harder to come by as inflation increases and silver's monetary role increases.

If your payoff is, say, $5k you could pay off your house right now for ~172 ozt of silver @ $29. If silver goes to a conservative $50, your payoff is now 100 ozt of silver.

I say keep stackin.


QFT

Any day a bank will take fictious paper in lieu of hard currency is a bet I will take until the sun goes down

[osoab]

Four Letters


M O R E

[chad]

well, good to know i'm the 1%. :D

[BabushkaLady]

When you think you have twice as much as you'll need; you have half enough.

--Theory on firewood. Works for PM's too. :cool:

[ximmy]

When you think you have twice as much as you'll need; you have half enough.

--Theory on firewood. Works for PM's too. :cool:

What about body fat? Does it work for that too...;D