Wealth Secrets: Gold Investing or Silver Investing – Is Now the Time?

While gold investing or silver investing does not lead to creating wealth (unless you’re investing in a mine or something that creates cash flow), gold investing and silver investing is one of the wealth secrets that most people just don’t know about.

I’ll tell you WHY you want to be investing in gold or silver here in a moment, but first, did you see the spot price of silver and gold yesterday night?  Silver was down to $26.11 at 1am and gold was down into the $1500s, which is quite a bargain considering silver was near $50 just a month or so ago and gold was over $1900 (talk about a bargain!).

silver investing(Side-note: Contrary to what many people may believe, even the super rich like to shop for a discount or sale.  The difference is the rich shop for assets on sale – things that will only put more cash into their pocket at a cheaper price – versus what most people like to shop for, and that’s doodads or liabilities – things that do not put more money into your pocket.)

So why silver investing or gold investing?

I don’t like to strongly advocate too many things in the midst of all the economic uncertainty today – especially something as controversial as gold investing or silver investing. Thanks to the internet today and cell phones and email and all the other ways that we receive information, pretty much everyone today KNOWS about gold investing or silver investing. Yet many are still not really paying attention or are simply misinformed about these wealth secrets…

Let me just quickly recap the present economic conditions today (ie, why silver investing/gold investing):

  • The price of an ounce of gold is around only $1600/ounce (has already risen into $1900s but has come back as of the original date this post was created).
  • The price of an ounce of silver is now currently hovering around $31 an ounce (down from near $50).
  • Most economists as well as the Fed had all predicted strong 2nd half economic growth this year which would even out the year at 3% growth (even though the first half of the year was closer to 1% GDP growth? That’s a lot of growth in the 2nd half of the year, especially considering the economy is currently stalling).
  • The stock market continues to be erratic with the 3rd largest daily drop in history recently followed by several more days of equally impressive swings up and down in the 400-600 point range
  • The US’ credit rating was down graded for the first time in our history (are we following in Japan’s footsteps when their credit rating was down graded, leading to 10 years or so of stag-flation?)
  • Fed chairman Ben Bernanke announced – now that the money printing from QE2 has run out – that interest rates would not rise for two years (meaning inflation will continue to rise unchecked without the normal counteraction of rising interest rates which will further depreciate the US dollar).
  • Precious metals margin requirements were raised yet again recently for both gold and silver, forcing those with positions in the silver market to put up even more money to maintain their current position or sell, which of course places downward pressure on the market (even though requirements had been increased as many as 10 times recently)
  • Prices for goods and services across the board and beginning to rise as inflation continues to increase (officially at a rate of 3.5% but unofficially – read: in reality – at over 7, according to ShadowStats.com); the government has announced it will further revise it’s CPI (consumer price index) numbers, meaning they want to change the equation to reflect a lower CPI than the average person is actually experiencing (financial repression)
  • The housing market remains weak as house prices continue to remain dismal
  • The unemployment rate remains above 9%

These are all very well known facts, however taken altogether reveal a worrying trend.  To give some perspective, last year at this time to compensate for a weaker than hoped-for economy, the Fed implemented their QE2 money printing program to help stimulate the economy.  What it did do was stimulate the stock market as evident by the large double digit market gains in the market since about this time last year.  Of course this just sent the prices for gold and silver higher reflecting the additional money being pumped into the system which eventually leads to a depreciating dollar.

Wealth Secrets -Here’s the opportunity:

Typically, the precious metals cycle each year in the summer months.  There’s an old expression that goes something like “Sell in May, go away and don’t come back ’till Labor Day”.  The precious metals market is generally weak during this time (great for silver investing!) due to a decline in seasonal demand that usually picks up again in September.

Last year, given the state of the economy, Fed Chairman Ben Bernanke announced from his annual Jackson Hole Fed meeting that they would pump more money into the system via a QE2 money-printing stimulus program.  That sent prices higher in August.

This year, due to intense congressional pressure the Fed has refrained from implementing QE3 (so far, that is) which has resulted in a stalling economy which is causing the markets to become even more erratic due to the continued uncertainty.  Strong precious metal buying countries like India have not yet begun their seasonal precious metal purchases combined with repeated margin requirement increases among other factors has created the opportunity to pick up precious metals at these lower than normal prices.

The bottom line is, if you’re concerned about the health of our monetary system, our currency, our ability to meet our financial obligations, the growing government deficits, etc, etc, you may want to look a little closer at putting your money into something with real intrinsic value, something that has been recognized as true and honest money for thousands of years, something the government cannot manipulate or devalue.

How can you start investing in gold or investing in silver?

I’d start by visiting your local coin shop.  I’d visit a few, ask them their opinions and see what the prices are for silver investing or gold investing.  Typically you’ll pay about a dollar or so over spot for silver, for example, if you’re buying bullion. American Eagles that are minted by the US Gov’t will carry a higher premium because there is a limited supply run each year (there may be some tax advantages to buying American Eagles but if the dollar crashes, people likely will only pay you for the amount of silver your coins have, regardless of the number printed on them).

My suggestion is to buy the cheapest form of bullion you can find (which at the moment is junk silver, ie, a bag of old dimes and quarters from when they consisted of 90% silver).  Kitco.com is a great resource online where you can monitor the price of various precious metals, see charts and graphs and get the latest news from the sector (great way to add to your financial education).

For most people, silver investing is much more affordable because you can buy rounds now at $32 or so.  Even a 1/10th ounce gold coin will cost you nearly $170.  Plus, as I’ve mentioned in other articles on silver investing, silver is expected to outperform gold in the long run due to it’s fundamentals.  On the other hand, if you have a lot of wealth you want to store, it’s much more practical to store it in gold than silver (from a weight and size point of view – think storage and security).

And, if you’re in a situation where you aren’t able to purchase as much gold or silver as you’d like to protect yourself from the increasing inflation and uncertainty out there, I’d suggest finding other ways to make extra money, as much as you can right now, while prices are where they are and while things are where they are.  All I’m saying is that times are definitely changing and you cannot expect things will continue to be the way they have been over the past many years.  How things will change exactly or what may change no one knows.  In the short term at least, our way of life is not sustainable.  We can only kick the can down the road for so long before we have to deal with the circumstances.

So take the opportunities available to you today and make the most of them while they are available, do not delay.  Whether that’s starting a business from home, adding another stream of income or something else, take action today and I guarantee you won’t regret it.

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  • Nic Van says:

    I have been a Jeweler for 32 Years. Gold came from $300 a ounce in my days. Gold and Silver is a GOOD Investment.

  • Akos Fintor says:

    Hey Hans,

    I remember when in Jan. of 2010 I told my wife (after doing some research) that we should invest in silver. ( it was $17 back then) We put in some money but we could have done much, much better.

    Make money work for you; after all that’s what it does best.

    thanks for the share!


  • William Earl Amis Jr III says:

    your outlook is favored and the highest levels that gold can reach at this last quarter ending as gone. As for silver investments is a great action to take. We use silver for more things than people realize and that is why it jumps so high at certain time each year. It can be purchased and stored for little cost. No one wants to have ounces of silver bars and/or bags of silver coins in their homes.

    I have a safe and would not be a problem with our security system. I have always believe in increasing the revnue I have and utilizing the markets.

    With silver it is a safe bet. That is how everyone can think about it. If you join a club that everyone has more with leverage is a method most never speak of. Being involved in every area of your future is what everyone should do now. Dollars only will go so far as we have seen the drop in our credit being in the U.S.A.

    Hans, your one of our great mentors and visionary in our industry. I have left selling stocks, bonds and commodities many years ago. I still practice the bottomline for myself and show all how it is done without the middle man pricing. Fees can be avoided and that is where allot of people get mixed feelings.

    Nice article and I love your site. Your presentation is so investment presentation style. It is too deep for most and being dry material more comparing should be used. It’s the material and not the facts.

    Yet, wealth is not monitary. That I agree with and will love to see more people understand this. The more you make the bigger the toys and bills. Most forget less is best and slow growth is safe.

    I look forward in your next user friendly post. Make us smile and laugh when presenting this type of material to the masses.

    Thank you for sharing with all that passion you have.

  • stephen says:

    Thanks for your reviews people … How do you feel about investing in Gold or Silver? Is it a good time to do it when the value is going up instead of going down lol! Haha gold is kinda good looking if you know what I mean

  • Great opening line about CREATING wealth vs investing which is having money work for you.

    Investing correctly, and looking at long term investment cycles is just not something most people understand.

    • Hey Andrew, it’s definitely a different way of thinking. You have to invest with the long term in mind. What’s the ultimate goal? It’s all about creating wealth… Thanks for your comments Andrew!

  • Lynda Cromar says:

    Thanks Hans,

    Most of the time I am completely baffled. Then I get shell-shocked! I appreciate your tip to start with something affordable like buying small amounts of Silver, or even junk silver at first.

    • It all starts with taking the first step. You can think of buying silver coins like saving real money. It is exciting though to trade your cash for silver because holding it in your hands you get a real sense for it’s true value as opposed to the paper we’re all used to. Thanks for your comment Lynda!

  • David Paul@network marketing leader says:

    Hi Hans,

    I am glad to know people like you who have an interest and expertise in investing, because as a network marketing leader my focus in on building people, not building portfolios. So, Thanks.

    Question; You said “Silver was down to $26.11 at 1am and gold was down into the $1500s, which is quite a bargain considering silver was near $50 just a month or so ago and gold was over $1900 (talk about a bargain!).” Is this really a bargain, or is it a sign that gold and silver prices are beginning their downward price turn, just like they did back in the early 1980s? How do you know that this isn’t not the sign of the downturn an thus a sign to SELL?


    David H. Paul
    the Follow Your Bliss guy
    from NeoTrainingNetwork.com

    • Hey David, in this market climate, no one knows for sure due to all the manipulation and constantly changing rules. However, the fundamentals for silver and gold increasing only continue to increase as our monetary problems continue to worsen. You’re seeing country’s debt ratings drop around the world, the economy is stalling out again, unemployment remains high, our country’s debt continues to increase out of control with no real plan on how to tackle it (other than financial repression, or inflating the debt away)… These trends only lead to higher gold and silver prices even though there may be some de-leveraging in the process.

      I started out in network marketing years ago which led me to look into investing and multiplying wealth. Because if you don’t know what to do with your money when you make it, it will certainly go (or the government will take it in unnecessary taxes) and you’ll end up working harder than you have to. I believe in getting the most out of your resources, be it time, people or money. So now I help people make money, but also try to teach them what to do with it once they’ve got it. Hope that helps David! Thanks for your comment.

  • Jaclyn Castro says:

    Hi Hans,
    That’s for sure – not many people know the value of investing in silver and gold. For one, it is being talked about only in front of the target audience – that would be the investors, not in familiar places like social media for example.

    I’m so glad that my husband and I are IN. We am putting our money in the right place and we are working on creating a legacy for our family. On top of that, we’re paving a path for our 2 children and leading them by example. Forget about a savings account and all that other “stuff” people are talking about in order to “secure” our future.

    Looks like you and I are both on the same boat. Be seeing you around the silver bend Hans! And if you wanna connect more, shout out for me okay? Love to connect with like-minded people!

    -Jaclyn Castro

    • Hey Jaclyn, completely agree with you. It’s a small circle of investors relative to the rest of the population who are “in the know” about the importance and significance of gold and silver investing. Hopefully we can get the word out to more people with posts like these and comments like yours. Thanks for sharing and looking forward to connecting with you. Thanks for the great comments!