At one time or other, everyone has had buyer’s remorse. You bought something, and after doing so, wish you hadn’t. Ever buy a new or used car and found that you could have bought it elsewhere cheaper, or that it was defective? Gotten home with a bag of groceries and discovered that the milk was sour or eggs broken? Voted for a candidate and discovered that he or she wasn’t what they were campaigning as? George Bush, for example? Ever bought a book with a cover that appealed to you, and discovered that it was a bad read? I’ve done all of those, and you probably have too. I’ll bet New York’s Governor Spitzer has buyer’s remorse over his purchase of the affection of a $5,000 per hour hooker. What on earth could a woman do to or provide a man with for $5,000 in one hour? And he supposedly ran up an $80,000 bill. Who knows?
There are millions ever day, who have buyer’s remorse over a stock they have bought, and there will be millions more who will be very sad if they don’t get out of the market pretty quickly. (The PPT had a ball yesterday, or the CEO’s manipulated to get out). Those of you who have been reading my stuff for many years may well remember how I begged people to sell their stocks before the crash, and I was correct. I warned of a real estate crash, and said that if you were ever going to sell a house, do it then, because you might never get that price again, and I was correct.
Has there ever been buyer’s remorse over buying gold and silver? Back in 1980 there was, but in late 1979, I warned people that it might be a bubble, and actually refused to sell it towards the end. Made a lot of folks angry. So angry that they bought elsewhere and were sorry. The firm I was working in was very unstable, and in March, 1980, I walked out, warning its owner that he was going to go bust and to jail if he didn’t do what I told him to do in a three page, single spaced letter I gave him when I left. He didn’t follow my advice and he did go to jail and his firm took millions when it went down. In February 1980, my earnings for that month alone at North American Coin and Currency were over $16,000 in 1980 dollars, and I walked out. Everyone thought I was nuts. I wasn’t. I warned everyone then, and I still do, do not let anyone store your precious metals for you. When the firm that stores it gets into trouble, yours goes with it. North American’s storing millions of dollars worth of metals for its clients, cost them every single ounce they had bought. Talk about buyer’s remorse!
Gold and silver in 1980 were responding to several things, which alarmed people, and they logically sought safety in metals. First of all, there was Jimmy Carter’s Presidency. Then the hostages were being held in Iran, thanks to Carter’s taking in the Shah, whom the Iranians hated. We were paying to give away the Panama Canal, which was another Carter idea, and for which he should never be forgiven, no matter how many nails he drives for Habitat for Humanity. We also had 21% interest on mortgages and a 13% prime rate. Bunker Hunt was trying to corner the world’s silver supply, and that drove it up far too high, with gold following because of the rest of the Carter caused agony. Gold and silver reached $850 and $54, and with consumer prices as they were in 1980, those prices were far too high, as everyone sees now, in retrospect. Silver and gold prices were so high, that people were selling their flatware, vases, watches, and jewelry, because of the bonanza they could receive. Nothing like that is happening now, nor will in the foreseeable future, unless it is to get a few bucks for gasoline.
Millions have had buyer’s remorse when purchasing numismatics, and I hear it every day. They bought a coin for $2,000, and tried to sell it, and were offered maybe $1400. Coin shops and dealers in numismatics, buy wholesale and sell retail as all shops do, and as they must if they are to make a profit. A 30% – 40% markup in merchandise is common for retail establishments, and is true in coin shops also, and it has to be that way if a shopkeeper is to stay in business. Buyer’s remorse is a normal thing in a retail shop, if one buys something they wish they hadn’t bought. My son and I don’t run a coin shop, but are simply low cost, low percentage brokers of bullion type coins and bars. The difference between the price you buy them for and sell them for is known as the “bid-ask spread,” The “ask” is the price you pay to buy, and the “bid” is the price you sell for, and rarely is it more than a few bucks an ounce for gold and fifty or sixty cents an ounce for silver. The Canadian Maple Leaf has the largest “spread,” and that’s why we don’t particularly like them.
To preserve one’s wealth, one must get out of dollars, and the most convenient way to do it is with what has been historic money in all nations for thousands of years, and that is gold and silver. One should get the most gold and silver for the least amount of dollars, hold it yourself, and have the lowest spread, so that when eventually you might want to dispose of it, you can do it easily, and with little financial penalty. We aren’t interested in a coin or bar’s age or condition, but how many ounces of gold and silver you are getting for your dollars. Preserving one’s assets, is dependent on ounces, not age or condition…or at least that’s the way we feel about it. For the last 20 or so years, there has been no buyer’s remorse when one has purchased bullion types of coins and bars. Gold has gone from $250 to almost $1,000. Of course there have been times when they corrected, which is true in all markets, but a graph will show a healthy 45 degree line straight up, as the dollar’s graph will show one in the opposite direction. A bit of buyer’s remorse if you buy gold at $925, and it goes back to $900 the following day, but chances of its going back the following day or week, are almost 100%, until one can see a time when the dollar presses have stopped, and budget balanced. When pigs fly?
Could there be a time like 1980, when a top has been reached, and it’s time to sell? Such a time may happen, and I think that there are signs which may make it indeed a time to sell one’s gold and silver, and invest in something else. Since 1980, we have had at least 400% inflation, so for gold and silver prices to be equal to 1980’s top, gold would have to be about $4,000 and silver $250. If those prices are reached, and they will be, one must then look at consumer prices. If, when gold is $4,000, and the gas price is maybe $5 and the stock market is 2,000, stocks may be an excellent buy! I hear that one can buy a condo in Las Vegas now for an incredibly ridiculous price, and that there are tens of thousands of them available for a literal song. Maybe it is a good time to buy one, I don’t know, except I wouldn’t want to live in a condo, and wouldn’t want to leave one empty for just occasional use. Want to move to Las Vegas? Pretty soon, it might be an opportune time.
Buyer’s remorse for buying a condo in Las Vegas? It might happen if riots break out, or your condo is vandalized. You might not like 110 degree summers and polluted air. Buyer’s remorse for buying gold or silver? Not hardly, other than if there is a brief correction. How can there be buyer’s remorse, if gold and silver keep ’going up’ in failing dollars, and will probably go up faster than oil, eggs, glass, lumber or tires? Why stay in failing dollars? Staying in dollar denominated ’investments,’ guarantees one a huge amount of buyer’s remorse as the years go by. Protect yourself.
(Spring is almost here. My yard has sprouts of everything showing, and the grass is getting green. Thank goodness!)