Should I Buy Gold as an Investment?

Analyst and Investor Jonathan Hodges addresses this important question, which is vital for individuals who wish to preserve their wealth through purchasing gold and silver.

While many are enchanted with sports and celebrity news (Lady Gaga outfits or Justin Bieber hairstyles), the population needs to be aware of the economic collapse taking place around them.

Visit some of Jonathan's blogs:

http://wisdomandword.blogspot.com/
http://www.aintmymedia.com/
http://endofthefed.blogspot.com/
http://metthatceleb.blogspot.com/

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Nonprofits & Activism

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• gold
• silver
• ron paul
• fed
• Justin beiber
• lady gaga
• freedom
• constitution
• mike Maloney

[Comedystreak]

@jeanchristiansl

Yes, a lot of investors don't read the prospectus, and realize that the custodians in the paper market no not have enough silver to cover for all of the contracts. They will have to settle for cash as the silver inventory runs out. An example of Short selling is when you borrow a security at $10 today, and sell it at $10; then you want the price to go down (say to $5) so you can then buy it back at a lower price when you need to deliver it back to the original party.

[jeanchristiansl]

@Comedystreak

So if I understand correctly, what you're saying is that there isn't enough real physical silver to actually back all the 'paper' market. This would mean that people who are purchasing silver through certificates are being miss led in thinking that they're purchasing the physical metal? What they are buying is the idea of owning it. So how do you think this is going to play-out, is it when people will want to redeem the certificates for real silver at one point? Explain short sel

[Comedystreak]

@jeanchristiansl

A few factors. 1) The current price of silver is being determined by the 'Paper' market through the selling of options and futures contracts. Some believe that the amount of silver ounces being traded in the paper market dwarfs the actual physical supply by a ratio of 500:1. This won't last forever, as smart buyers go into the physical metal. 2) Short sellers such as HSBC & JP Morgan have gigantic 'Short' positions against silver, meaning that they lose if price goes up. :)

[jeanchristiansl]

@Comedystreak

But what do you think is keeping the price of silver so low and what do you believe will make it rise to a 1:10 ratio as you predict?

[Comedystreak]

@jeanchristiansl

Yes. The current ratio is around 40:1 and my opinion is that it will reach ten to one. Silver is more plentiful below ground, but more rare above ground, which is causing lower supply, which will = higher prices.

[jeanchristiansl]

Some say that silver has normally been the 1/12 price of gold and that it is in fact rarer then gold because of its use in electronics. 40$ an ounce is lesser then 1/12, does this mean that we should expect a rise in the price of silver at one point in the future, perhaps when the shit really hits the fan?