I Have a Question About Gold and Silver..

http://www.numismaster.com/ta/numis/Article.jsp?ad=article&A...

[snip] What do the following industry-leading companies have in common?

Alcoa, AIG, AMBAC, American Express, AMR (American Airlines), Bank of America, Bear Stearns, CBS, Citigroup, Countrywide Credit, Delphi, Dow Chemical, Eastman Kodak, Fannie Mae, Ford, Freddie Mac, Gannett, General Electric, General Motors, Goodyear Tire, Harley-Davidson, The Hartford, International Paper, JDS Uniphase, Lear, Lehman Brothers, Liz Claiborne, Macy's, MBIA, Merrill Lynch, MetLife, MGIC, MGM, Motorola, JC Penney, Prudential, Saks, Sears, SprintNextel, Tenet Healthcare, UAL (United Airlines), United States Steel, Wachovia Bank, Washington Mutual, Whirlpool, and Xerox.

The answer: Since the middle of 2007, all of these companies have seen their stock values decline by more than 80 percent.

At the close of markets on June 29, 2007, gold was at $648. Its price now is more than 40 percent higher than it was then. Gold has outperformed the stocks in these companies by at least seven-fold in the past 20 months

This is fun.
http://www.coinflation.com/coins/silver_coin_calculator.html

The gold/silver ratio has been negatively correlated with the price equities for thirty years. In other words, when the stock market was down, silver tended to be down relative to gold, and vice versa. That was not the case in January and the first half of February, as silver gained relative to gold, while the stock market declined. Since then, the ratio has held while the market continued to tank. However, silver was coming off of a vicious beat-down.

I consider my physical metal to be worst-case scenario insurance. I don't want much more than I can tote. Therefore I have only a couple of bags of junk silver and some Silver Eagles. Gold has more concentrated value.

It really depends on why you are buying gold or silver.

First, how much money are you looking to spend. A few thousand dollars will buy you only a few ounces of gold, but a whole lot of silver. If you are looking to buy with a few grand or less, stick with silver.

If you're buying to avoid the "coming" collapse of our money system (I use quotes because i'm not one who'll tell you it's coming) then silver is your best bet. Gold will be damn near impossible to spend, because it's so valuable and it will be tough to get change for a bag of groceries. It's pretty plausible, though, to exchange a 1oz silver coin for a few weeks worth of food.

If you are looking to convert a big chunk of your nest egg into precious metals, gold is your metal. You can store hundreds of thousands of dollars in a very small space, and it is immune to inflation and currency collapse. It's also very easy to take with you if you have to leave in a pinch. You can easily fit most people's life savings into a small suitcase, which cannot be said for silver.

So, if you're small time and just looking to store just in case something bad happens, silver. If you've got bigger aspirations, gold.

About 90% of my metal by dollar-value is silver. It is divisible, carries much lower premiums than gold, and IMHO it is prettier.

Silver is the best thermal and electrical conductor of any pure metal. It also fell through the floor last year, unlike gold. I am betting that when the dollar finally exits its walking ghost phase, silver will see a much larger percentage gain than gold. But I expect volatility.

Platinum is more of an industrial metal than silver is. It superficial appearance is very close to silver's, so it doesn't find as much ornamental use as gold. Another poster correctly noticed that platinum and palladium have catalytic properties, which makes them incredibly important industrial metals.

Palladium can store 900 times its own volume in hydrogen gas.

My Shelfari page

gold if you can afford it, though i see silver moving up with gold percentage wise and quite possibly way outperforming it in the coming years. i cant find palladium for under 300/oz. if you can find it for 250 id pick some up. all in all, silver is a great way to get started. it becomes addictive, and you'll be cutting spending in other parts of your budget to accumulate more before you know it;

Silver is the way to go... especially if you don't have a big load in your bank account. Unlike Gold, Silver is used widely thoughout many industries and without silver many of these companies would fail (or at the least have to spend lots of money to develop materials with the same electrical properties of silver). When people begin to take notice of the silver shortages, prices of silver will skyrocket. Don't let the price comparison between silver and gold fool you. In the long run, silver is a better buy and is much easier to get into than gold - due to the costs.

Once you've been collecting silver for a while and are determined to stick with the investment plan, then it wouldn't hurt to start investing in other PM's. While they are more expensive than 1oz coins, you can buy 1/10oz gold coins for just over $100 which is much more reasonable than $900oz (if you don't have much cash on hand). Platnium and Palladium may also be good investments but beware, the demand for these metals are much lower than silver. Platnium's primary function is in the manufacturing of jewelry. Platnium is also primarily mined in the Africa and Russian regions where production is controlled to keep the price high. These Countries typically don't divludge the quantities of their mines. If they are sitting on vast amounts of platnium, then you can bet the price will always remain fairly steady (with the exception of political turmoil which is the reason the price of platinum shot to $2000 last summer).

Palladium isn't much different. Palladium is often a by-product of the platnium mines and as far as I know, there aren't many industrial needs for palladium other than the construction of cadillac converters. Should technology improve and they find better ways to filter toxic fumes from automobiles, I'm not sure if the demand for palladium would be strong enough to move the cost of the metal much higher in price. Not to mention that palladium and platnium are much more expensive to get into if you are on a short budget.

So in my honest opinion, I would suggest investing in silver over the other metals, but, should you decide that you enjoy investing in metals, you should definiately diversify your portifolio and pick up other types of PM.

Apmex.com has 10oz bars going for $137.00 right now which is a pretty good deal. Purchasing one or two of those would be a good start to any collection.