Can I sell My Gold and Silver Now

Zero Hedge's picture

Sponsored Post by Lear Capital

Gold prices seem to be setting new highs daily. Of course those would be highs not adjusted for inflation or debasement of the dollar. If we were to set real highs, we would have to see gold prices rise near $2400 per ounce - maybe higher! Obviously, a dollar today is worth far less than a dollar was in 1980 when gold and silver hit long-standing record highs of $850 an ounce and $54 respectively.

Just to help you put things into perspective, in 1980 a postage stamp was $.15 cents, a gallon of gas was $1.25 and the Median Household Income was $17,710.00. Our entire Federal Debt was just $909.1 billion and government spending was a paltry $590.95 billion. Here's one more little tidbit, the Dow reached a high of 1000 and a low of 759.

These things considered, it's no stretch to say gold would have to triple its 1980 record high in order to claim the title of, "New Record Holder". Of course, most realize the $850 an ounce price marked the end of a bubble. Gold prices, as did silver, made parabolic moves higher and then quickly dropped off their highs to enter a new age of easy credit, higher wages and economic expansion. Thank you Ronny.

Is that what gold and silver investors have to look forward to again? Reaganesque growth? The stigma attached to precious metals investors is that they hope for doom, economic collapse, hyperinflation, currency failure and every other kind of market debacle. I believe the contrary. I believe precious metals investors would gladly trade gains from higher metal prices for a return to the days when real estate had value, stocks were constantly driving to new highs and jobs were plenty.

Enter budget, deficits and debt. The prospect of a return to utopia seems to grow weaker each day. Hence, more gold and silver are being bought - not less! So when do we sell? Have prices topped? Is it time to liquidate and take profit?

If we believe gold's 5000 year history as a preserver of wealth, we have to begin to compare the gold price to the markets and weigh its value in comparison to our Federal Budget our deficits and our debt. Are precious metals now working to preserve wealth? This is where it gets interesting.

Let's take the Dow for example, to buy an equivalent position in the Dow today as existed in 1980, it would cost you 12 times as many dollars.

Note: The Dow is a very convoluted and subjective measure. The Dow components themselves are subject to change by committee in order to better reflect current economic conditions. In fact, did you know GE is the only remaining of 11 original components? Then, in order to account for things like stock splits, additional calculations are made to keep the measure accurate. See this link for a complete explanation on the History of the Dow.

As we relate today's gold price to the Dow, you see why some say gold could be trading as high as $10,000 an ounce in order to pace growth in the Dow average. If we look at budgets and debt, the case for gold at an even higher price per ounce can be made. Today, Federal spending is 6 times what it was in 1980 and debt - which we could reasonably argue should pace inflation and debasement of the dollar - is nearly 16 times greater. . . and rising!

Now to the question, "Can I sell my gold and silver?"

Obviously it's a question I hear more often as prices move higher. I believe that is a question each person has to answer for themselves. I usually ask some questions in return, "Do you need the money?", "If you sold, what would you put the dollars in?" . . . and, "Why did you decide to own gold and silver to begin with?

Let's keep in mind that, really, very few individual investors own either gold or silver. (See this previous report that puts into perspective the actual size of the metals market in comparison to world financial markets.) The price has risen because central banks are buying it, countries are buying it and huge investors who see the collapse of currencies on the horizon, are all buying gold. Do you think just because gold and silver have climbed this far, (not even to inflation adjusted highs) that those big players are licking their chops to sell?

When I ask the question, "Why did you decide to own precious metals to begin with?" the answer is usually something to the effect, when the world money collapses I want something real as protection. Bingo! That is the same reason central banks and countries like Brazil, Russia, India and China (others too) are all buying gold and silver. As far as I can see, there has been no real currency collapse to this point. We still print it, spend it and use it to pay our bills and buy things. Hyperinflation is at bay. The illusion is alive.

So, if the purpose for owning gold and silver and other precious metals is to protect against collapse, wouldn't selling it now defeat the purpose? And if currencies do not collapse? Then great, the plan to print our way out of depression and collapse worked and we can all go back to work, borrow some money and speculate in real estate again.

If you still insist on selling any gold or silver, visit Lear where Lear's buy prices are posted right online for your review. Not only will you find Lear to have the best online prices but you will also find they offer a fair price when you finally decide to sell.

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OrestesPenthilusQuintard's picture

Sutton, Antony: The War on Gold

Newsboy's picture

Sure, I'll sell my gold.

Pay me in SILVER.

A Lunatic's picture

I've tried that all takers.

dbTX's picture

The war on poverty is really going well

Pool Shark's picture


Haven't you heard?

The war on poverty is over.

Poverty won.


Two Towers AU AG's picture

Maybe this helps.. I posted this in some other article as well..

Some news I got from my brother there is a silver futures exchange being opened in Mumbai, India where they are trying to access 1500 tons (approx 47,250,000 oz of silver) this year as reserves.. trying to get some valid leads to confirm this story.

calc done as 1500tons*1000 kilos per ton*31.5 oz per kilos = 47,250,000

one link from 04/26 is here

silver trading on MCX is ranked #1 by volume in the world.. and here is where the future trading is being introduced..


Silver bitchezzzz

sellstop's picture

I saw a headline on CNBC World a few minutes ago about a new silver exchange in India, i think.


Two Towers AU AG's picture

Yes.. I saw it too.. thats not the point I was trying to make..  I live in the USA but I come from India and what I see in this bit of news is that if there is now an exchange in India trading silver futures then the silver trade is definitely moving out of the US.. Give it one year to surpass the trade volume on the comex and see the global prices of Silver decided in India... The appetite of India for consuming PM's is more than the combined appetite of "The Bernank  and Morgue" for the FRN's.

gwar5's picture

Exactly -- highs adjusted for inflation are around $2400/$140 for gold/silver respectively.... and we're in much worse shape now.

The PMs are not going parabolic, the dollar is in a Kamikaze nosedive and the impact has not been priced in yet. People just don't want to think about it.

Don't forget, Paul Volcker was gagged and packed off to God's little waiting room somewhere long ago after a brief appearance. No chance of rate hikes to knee-cap PMs. Other things we lack: industrial base and our domestic energy tap has been turned off. Europe is no better off.

We remain surrounded by hostile Central Planners who want to destroy the USD as WRC as the solution to our problems. So, the day the Central Banks start selling gold, instead of holding onto it for dear life, is the day you'll know it is safe to come outside again.




W.M. Worry's picture

"Just to help you put things into perspective, in 1980 a postage stamp was $.15 cents, a gallon of gas was $1.25 and the Median Household Income was $17,710.00. "

I made $40K that year Trucking!! Fast forward 30 years and I'll be lucky to make $40K trucking. Good thing I was a custom home builder in the interim.

legal eagle's picture

You can sell it to me for spot plus $3.00, or APMEX, your choice

Hushups's picture

"I believe precious metals investors would gladly trade gains from higher metal prices for a return to the days when real estate had value, stocks were constantly driving to new highs and jobs were plenty."


Happily and in a heart beat.

moofph's picture

...1980?...Abscam was en vogue...time for Abscam II...FBI...FBI...Bueller...Bueller.

latizziforchizzi's picture

Does anyone here think it would be a good time to sell some physical silver in exchange for gold at this time? 31.5:1

lawrence1's picture

Yes, since I had much more silver than gold I decided to start moving gradually toward more like a 50/50 silver gold ratio.
If you agree with fofoa, you would hold predominantly gold. I think he may well be right, that "free gold" will happen. Fofoa needs to be read and studied; avoid him at your risk.

StychoKiller's picture

This ratio of yours, is it based on FRN prices or Troy ounces?

The-Dirty-Scurd's picture

sell silver and gold? im tempted to start prospecting in local creek beds and rock piles where i live. nevermind selling, time to start digging, panning and splitting quartz. ive heard it only costs 5 dollars to dig silver out of the ground. so shouldnt be a problem.

mark mchugh's picture

I've got a creek nearby, don't think I haven't tried panning.

Ahmeexnal's picture

Only thing you'll pan out of those creeks is shoes, severed heads, spent fuel rods, and used condoms.

legal eagle's picture

Make sure to ask the dentist for silver fillings, forget those "white" fiat fillings.

Temporalist's picture

Here is Jim Grant from 4/28 on Blmbrg discussing the gold standard and Fed, etc.:

Grant Expects Another Round of Fed Quantitative Easing


pagan's picture

I just sold all my goldstocks. Bought them after the crash in 2008. So it's been a wonderful ride.

But something fundamentally new has happened. The goldprice continues moving higher but the goldstocks goes the other way.

SignalSoldier's picture

I would re-enter if I were you pagan, gold/silver stocks rally behind the price of the metal.

Howard_Beale's picture

Wow, a sponsored post with the ZH logo. Sell it while you can.