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GOLD, SILVER & Facebook

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Two weeks ago the buzz on Wall Street was Facebook’s IPO (initial public offering). As I write, Facebook stock is down nearly 23% from the original offering leaving many investors questioning such a sure thing. This leads me to ask how comfortable you are with your investment portfolio? From your emails, most are still on board with silver, gold too, but will we feel the same if gold drops below $1400? My bet is $1400 gold would make for nervous investors even though true metal owners know the best days for PM (precious metals) are still to come.


It is easy for me say the recent drop in gold is nothing to worry over since I bought most of my physical gold years ago, some of you cannot say the same. I won’t attempt to justify why gold is down lately since the answer is trivial compared to what motivates gold over long term.

Some of you are thinking of jumping from gold all while I’m timing when to add more. The only difference between “us” is perspective. You perceive gold as risky and I perceive gold as the only protection against fiat supported governments unwilling to go down without a fight. I perceive the crises of 2008 as a monetary siren and you perceive the economy as in recovery.

The type of investor willing to buy Facebook stock is the same one willing to accept forty years of a fiat based economy as sustainable, it is not. Facebook stock is declining because more folks around the world are beginning to dispute today’s fiat Ponzi scheme.

A few weeks ago, most investors perceived Facebook a wiser investment than physical gold/silver? We must realize the one thing Facebook and today’s gold/silver prices have in common is volatility. Putting a value on Facebook is nearly impossible just like putting a value on silver and gold is too (for two completely opposite reasons). With that said, here are the differences between PM and Facebook.

  • Facebook is socially popular, gold is not.
  • Facebook is a very young company, gold is the oldest form of money.
  • Facebook is moving toward global status, gold is a global currency.
  • Facebook’s future value is in question, gold’s future value is in demand.
  • Facebook unites the internet world, gold unites the wealth of the world.

It is no secret that I feel social sites, like Facebook & Twitter, will play a major role in PM prices extending beyond what most view as expectant or realistic. Nothing will transport the news of another bank holiday, Lehman collapse, or government bankruptcy like social networks can.

To be fair let’s talk about the long-term projections of a giant like Facebook. After all, Facebook stock should offer promise since this is a young company founded by some of the sharpest minds in our tech world, right? Maybe not. Will economic instability help influence Facebook stock upward? Will social unrest, the S & P in retreat, worldwide housing declines, or market volatility in general help elevate Facebook stock over long term?

No, aforementioned forces will not help Facebook’s stock value. Just because Facebook itself will find popularity around the world doesn’t necessarily justify it as a worthy investment, at least not as priced.

To find comfort in silver and gold requires a realization more than anything else. This realization must include the need for nontraditional monetary decisions during nontraditional times.

This “realization” must include a basic understanding how not one fiat currency has experienced long-term success, not one! On the other hand, gold has never experienced monetary failure. Now, with that said, who wants to buy some Facebook?

News Worthy:

REUTERS:  Biggest Greek Bank Warns of Dire Euro Exit Fallout

If Greece left the euro, living standards would plummet, incomes would be slashed by more than half, and inflation and unemployment would skyrocket, the National Bank of Greece warned on Tuesday.

The bank said per capita income would collapse by at least 55 percent, the new national currency would depreciate by 65 percent against the euro and a recession, now in its fifth year, would deepen by 22 percent. Read more here. TPS (The Prospector Site) adds, what is not reported is how US political forces are now pressuring European countries to PRINT stability into Europe’s economy.  This should be painfully obvious that those elected are willing to destroy currencies before facing political defeat.

News Worthy:

Congressman Ron Paul: Capital Controls Have No Place in a Free Society

The characteristic mark of a tyrannical regime is that it eventually finds it necessary to erect walls to keep people from leaving.  This is why we should be troubled by the “Ex-PATRIOT Act,” an egregiously offensive bill recently introduced in the Senate.  Following a long line of recent legislation and regulations attempting to expropriate more and more wealth from hard-working Americans, this new bill spits in the face of overburdened taxpayers and tramples on the Constitution.

If they wish to escape the Federal Reserve’s inflation by emigrating to lower-cost countries so their dollars will go farther, as many Baby Boomers are starting to do, the federal government will penalize them, and continue to penalize them for the rest of their lives as long as they hold any money in the United States.

No wonder increasing numbers of Americans feel this government is engaged in outright warfare against its own citizens. Every day the noose grows tighter, yet anyone who sees the writing on the wall and seeks to leave must pay exorbitant taxes just for the privilege of leaving, and increasingly the possibility looms of never fully breaking away from the government’s tentacles no matter where they go. Read more here. TPS adds, several international sites are now committed to provide accurate information to those interested in international dual citizenship or relocation. I’ll be the first to admit that this is not for everyone, but. Remember, life can change on a dime so don’t rule anything completely out. Check out International Man for more information.

News Worthy:

Financial Sense:  So You Think You Own Gold?

One of the most common reasons investors cite for buying gold or silver bullion is that they are losing confidence in fiat (paper) money systems and the over-indebted governments behind them. Many investors prefer to own “physical” gold rather than “paper gold”, meaning they want to own the real thing as opposed to a paper promise – a contractual commitment to deliver gold at a later date, or in other cases a contractual commitment to pay the equivalent of a future gold price to the investor.

But there is an alarming deficit of understanding among investors relative to how the precious metals markets actually function. In fact, I would go so far as to opine that most investors who believe they own gold really don’t! Read more here. TPS adds, Mike Maloney says it best, “If you can’t hold it then you don’t own it!!”

QUESTIONS & COMMENTS:

Question: This whole precious metal thing is confusing considering each so-called expert has a different opinion than the last. How do I know what is safe haven silver or gold? Two, who is trustworthy within the PM community? I don’t want to buy only to lose money like many others have over the last few months.  Please help since I’m not having much luck !

TPS Reply: Wow, you are loaded for bear but thanks for the questions. Let me start by taking some pressure off, ready? Don’t buy silver or gold, at least not yet, since first comes education (PM understanding) long before the steps in question.Don’t worry about prices going up since the risk of buying “wrong metal” far outweighs the risk of prices zooming.

Part of becoming comfortable with gold involves a basic knowledge of a fiat based economy now driven from consumerism. This understanding provides a solid foundation built from confidence that sustains a physical metal holder during times like today (this is why I pay no attention to media misinformation, dips or bubble talk).

Next, realize you’re not a coin collector and have no interest in rare coins. The goal is to trade currency for real money AS CHEAPLY AS POSSIBLE!! This is why we encourage readers to buy bullion coins, rounds, bars, or junk.

Now, as far as the who to trust question. TPS often interviews small family operated bullion dealers who have strong long-lasting reputations. Dig into our achieves to find one you are most comfortable with or visit a local coin shop asking to see their lowest premium silver or gold. Leave if they attempt to redirect you toward rare metal.

You mentioned a fear of losing money but this is far from the case. We can’t compare PM with typical investments of the past, i.e., real estate, stocks, etc. Precious metals are money. A wealth transport of sorts happens the minute you convert currency (what you called money is actually a currency) into PM.

Like all transportation the path to protection and prosperity is not a straight-line destination. Hills, valleys, dips, rises, are all part of this journey. No educated PM owner will sell physical silver or gold during a paper dip like the one we see today.  Thanks for reading The Prospector Site.

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