"Lenin is said to have declared that the best way to destroy the Capitalist System was to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens....Lenin was certainly right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose." ~ John Maynard Keynes
Think Like a Pirate!
Exclusive to STR
This is a follow-up piece to 'Strategic Self-Preservation.' It includes many of my replies to readers' questions and is tailored to those who are interested in buying gold or silver bullion coins as a part of their long-term financial plan, for the first time.
Thanks to all of my many loyal readers who requested the SSP Report. So far, I have e-mailed 211 copies of it to interested readers living all over the world, including the UK , Italy , and Australia .
Several people in the STR forum were wondering why I didn't just say 'buy gold bullion coins monthly' instead of going the five-page report route, by e-mail request only. My answer is simple: SSP was written for clueless newbies, not for gold bugs.
In addition, as a teacher, I am painfully aware that effective teaching requires several concurrent things, including: presence, being awake, paying attention, being willing to learn, and being actively involved with the lesson, by asking intelligent questions. Remove any one of those items and learning comes to a screeching halt.
By forcing readers to request the SSP Report, I automatically weeded out those who weren't willing to learn something new, even if it was in their best interest. They are the terminally ignorant and risk averse who, over time, automatically become relatively stupid because those around them choose to take a chance instead and risk learning something new. As I teach all of my students, the stupid shall be punished. What's the lesson? Don't be stupid.
Do not assume that anyone knows what the hell they are talking about, including me. Be a healthy skeptic; that's what I also teach all of my students. Do your homework, do real research, take no one's word for anything, and demand proof of their assertions. If they can't do it, walk away.
Gold (or silver) can be whatever you want it to be: savings, investment, speculation, inflation hedge, capital accumulation, potential for capital appreciation, or just plain old private capital.
Note that these are all very different reasons for buying precious metals, but only you can decide which of them apply in your particular case. Some you may deem critical, others not so much. Some you may actually realize, others not at all. Your call, your reasons.
If your budget is very tight, buying gold is not for you. You can't (and shouldn't) use food money to buy gold, or anything else. You can only use disposable income to buy gold, or any other 'investment.' This must be currency that you can afford to lose.
Silver is a good option today, especially if you are short on cash. Buy generic silver rounds (coins) of 1 oz. each. Historically, silver is way undervalued compared to gold today, with probably more upside potential than gold, at least in the short term.
There is a very good reason why silver is called the 'poor man's gold.' You can buy one of these coins for about $10 today. The only real problem with silver is the bulk, but if your stash is small, that is not a problem. Bulk only really becomes an issue if you can't lift your stash anymore. We should all be so lucky!
You don't buy gold to use it as spending money, you buy it to preserve your capital because inflation will eat you alive in short order. Since 1913, the dollar has been inflated 99%. Every day you hang onto dollars, you lose more purchasing power. Why hold a guaranteed loser if you can afford not to? This is a no-brainer for those who can afford it.
I bought most of my stash of Gold Eagles when gold was under $400 an oz. Today it is over $550, so I'm up 37% in about a year. Not bad for private capital. I'm up over $5,000 for doing nothing, other than swapping green ink on paper for real money.
The #1 problem of people who have never owned gold (or any precious metal) is that they all wait way too long to start buying it. Every one of them (years) later says the exact same thing: 'I wish I had started buying it sooner . . . .'
The most valuable thing you have is time; don't waste any of it by holding onto any more fiat currency than you have to. Start immediately, if not sooner.
Big picture: Think Like a Pirate! Here's how a Pirate thinks:
Pirates always plan for the worst-case scenario; if it happens, they are in good shape, if it doesn't, they are in great shape.
Pirates are not creatures of the herd, they don't do what the others do, nor do they really care.
Pirates are always assessing their surroundings, looking for threats, opportunities, and an escape route.
Pirates, at least the successful ones, make a quick assessment of the situation and then act quickly, they know that they can always change course if necessary; indecision is death.
Pirates know that a plan is necessary, but at the same time they are not bound to that plan if conditions change'and they will change.
Pirates know that history is nothing but the study of people making the same mistakes over and over again . . . and generally for the same reasons. A smart Pirate anticipates those mistakes and positions himself to benefit.
The Pirate's rule of thumb: He who shoots first wins; he does not polish cannon balls, over-think, or over-study anything.
A Pirate is a person of quick action who may often appear reckless or dangerous to the common sheeple.
Thanks to JCN, a fellow Pirate and 'eccentric troll who lives deep in the forest' for the above list.
You may wonder why I always capitalize the word Pirate. It is because Pirates are noble creatures indeed, for they are the only truly free men. Why? Because Pirates play by their own rules and they pay tribute to no one'as it should be.
See my related essay, 'Freedom and Privacy: R.I.P.'