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To Buy Or Not To Buy?

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Okay, not much been going here for a while and would like to gain some general consensus on here in regards to precious metals. Whilst I know I missed the boat (even 12 months back) and got into PMs towards the end of last year, I have seen my investment in them grow considerably which quite frankly makes my inflation ravaged ISA savings look rather pitiful.

I have been informed that this month I will be receiving a bonus (no I’m not a banker) and I am trying to decide what I should do with it, based upon my experience with PMs thus far, I am tempted to lump it in any buy more and f**k cash ISAs and equities.

Some of my thoughts are as follows:

- No point paying off my mortgage as 2 years left on tracker below BOE rate

- No point putting into a cash ISA at 3% considering current inflation (although nice to have some for emergencies etc)

- I’m concerned about UK equities as I believe the FTSE growth has been more down to emotive investment and underlying fundamentals remain on shaky ground

- Don't really know too much about emerging markets to go investing there through stocks and shares isas etc.

- Don't understand ETFs and how they work when looking into investing linked to PMs

- Cant see inflation falling too much and with no appetite in the US to address the deficit, I see inflation as being a long term issue.

- Continuing stability issues in Middle East / N Africa and oil supply fears

- Continuing rising oil prices threatening more inflation and the risk of recession

As I will be remortgaging in 2 years time I obviously want a degree of flexibility so that if I needed to pay off a chunk I can (but have LTV around 50% in any case).

I’d appreciate other HPCers two pence worth as I know there is a wealth of opinions out there in regards to PMs.

Thanks

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Okay, not much been going here for a while and would like to gain some general consensus on here in regards to precious metals. Whilst I know I missed the boat (even 12 months back) and got into PMs towards the end of last year, I have seen my investment in them grow considerably which quite frankly makes my inflation ravaged ISA savings look rather pitiful.

I have been informed that this month I will be receiving a bonus (no I’m not a banker) and I am trying to decide what I should do with it, based upon my experience with PMs thus far, I am tempted to lump it in any buy more and f**k cash ISAs and equities.

Some of my thoughts are as follows:

- No point paying off my mortgage as 2 years left on tracker below BOE rate

- No point putting into a cash ISA at 3% considering current inflation (although nice to have some for emergencies etc)

- I’m concerned about UK equities as I believe the FTSE growth has been more down to emotive investment and underlying fundamentals remain on shaky ground

- Don't really know too much about emerging markets to go investing there through stocks and shares isas etc.

- Don't understand ETFs and how they work when looking into investing linked to PMs

- Cant see inflation falling too much and with no appetite in the US to address the deficit, I see inflation as being a long term issue.

- Continuing stability issues in Middle East / N Africa and oil supply fears

- Continuing rising oil prices threatening more inflation and the risk of recession

As I will be remortgaging in 2 years time I obviously want a degree of flexibility so that if I needed to pay off a chunk I can (but have LTV around 50% in any case).

I’d appreciate other HPCers two pence worth as I know there is a wealth of opinions out there in regards to PMs.

Thanks

PM ETFs are quite simple. It's just like buying into an equities fund except that the underlying investment is in PMs instead of shares - check out PHAG and PHAU.

It sounds like you want to protect against inflation rather than speculate - so I would suggest waiting for the NS&I index-linked bonds relaunch later this year. They pay RPI plus about 1%. Previously you were allowed 2 x £15,000 bonds and they are tax-free. They are my only investment (other than PMs) that are beating inflation atm.

Edited by Constable

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Okay, not much been going here for a while and would like to gain some general consensus on here in regards to precious metals. Whilst I know I missed the boat (even 12 months back) and got into PMs towards the end of last year, I have seen my investment in them grow considerably which quite frankly makes my inflation ravaged ISA savings look rather pitiful.

I have been informed that this month I will be receiving a bonus (no I’m not a banker) and I am trying to decide what I should do with it, based upon my experience with PMs thus far, I am tempted to lump it in any buy more and f**k cash ISAs and equities.

Some of my thoughts are as follows:

- No point paying off my mortgage as 2 years left on tracker below BOE rate

- No point putting into a cash ISA at 3% considering current inflation (although nice to have some for emergencies etc)

- I’m concerned about UK equities as I believe the FTSE growth has been more down to emotive investment and underlying fundamentals remain on shaky ground

- Don't really know too much about emerging markets to go investing there through stocks and shares isas etc.

- Don't understand ETFs and how they work when looking into investing linked to PMs

- Cant see inflation falling too much and with no appetite in the US to address the deficit, I see inflation as being a long term issue.

- Continuing stability issues in Middle East / N Africa and oil supply fears

- Continuing rising oil prices threatening more inflation and the risk of recession

As I will be remortgaging in 2 years time I obviously want a degree of flexibility so that if I needed to pay off a chunk I can (but have LTV around 50% in any case).

I’d appreciate other HPCers two pence worth as I know there is a wealth of opinions out there in regards to PMs.

Thanks

Seems like you're on the ball to me. A couple of other points:

- If the worst happens and you lose your job and your house, money spent on PM's (instead of spent paying off a mortgage on a home that ends up repossessed) is yours to keep (providing you bought physical) as no one can prove you have the asset :)

- Even though PM ETF's are available they only track the metals price. If you want to go for electronic gold, go for allocated funds like bullionvault.com or goldmoney.com. However, be warned, while these are more flexible and have lower transaction costs than physical, your transactions are easily traceable and therefore taxable. Picture a future with a plunging pound and soaring gold - the govt, will wish to discourage gold 'speculation' and could easily freeze/confiscate electronic gold accounts or levy punitive taxes overnight that would be unavoidable when you sold. Physical all the way and preferably buy in smaller amounts so your purchases are more likely to go under the customs radar. If the worst happens then sell on the black market and cut out the government :D

I bought over 2 years ago and baulked at the fact I'd dithered for a few weeks and ended up buying at an average price of £643 an ounce rather than sub £600 prices had I just been brave and dived in as soon as I got the idea. I then had to contend with falling prices for a few months before gold bounced back strongly. All seems laughable now with gold at nearly £900/ounce. I suggest you'll be feeling the same way in a couple of years too if you take the plunge.

What's the alternative, see your money get destroyed by a deliberate inflationary policy? Remember, the west including, most importantly, the USA, are all following the same policy because global debt is way out of control. It will not end well for those with cash in paper, but those with pm's will see the biggest wealth transfer from the paper mugs to themselves they could ever imagine. :ph34r:

Edited by General Congreve

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Seems like you're on the ball to me. A couple of other points:

- If the worst happens and you lose your job and your house, money spent on PM's (instead of spent paying off a mortgage on a home that ends up repossessed) is yours to keep (providing you bought physical) as no one can prove you have the asset :)

- Even though PM ETF's are available they only track the metals price. If you want to go for electronic gold, go for allocated funds like bullionvault.com or goldmoney.com. However, be warned, while these are more flexible and have lower transaction costs than physical, your transactions are easily traceable and therefore taxable. Picture a future with a plunging pound and soaring gold - the govt, will wish to discourage gold 'speculation' and could easily freeze/confiscate electronic gold accounts or levy punitive taxes overnight that would be unavoidable when you sold. Physical all the way and preferably buy in smaller amounts so your purchases are more likely to go under the customs radar. If the worst happens then sell on the black market and cut out the government :D

I bought over 2 years ago and baulked at the fact I'd dithered for a few weeks and ended up buying at an average price of £643 an ounce rather than sub £600 prices had I just been brave and dived in as soon as I got the idea. I then had to contend with falling prices for a few months before gold bounced back strongly. All seems laughable now with gold at nearly £900/ounce. I suggest you'll be feeling the same way in a couple of years too if you take the plunge.

What's the alternative, see your money get destroyed by a deliberate inflationary policy? Remember, the west including, most importantly, the USA, are all following the same policy because global debt is way out of control. It will not end well for those with cash in paper, but those with pm's will see the biggest wealth transfer from the paper mugs to themselves they could ever imagine. :ph34r:

Interesting thoughts on Bullionvault et al, not really thought of it that way, but as Labour have had their hands removed from the tiller I'm less concerned about knee-jerk reactions (albeit I know all politicians are the same). My issue concerns buying silver at 20% VAT is just far too painful, albeit i agree its good to hold physical. Fortunately I travel a lot overseas with work and its amazing what coinage you can pick up which accidentally makes it way back home

In regards to the NSI index linked bonds; I remember them being withdrawn last year (I think?) and the relaunch later this year makes me highly suspicious as it seems to much of a coincidence that they were withdrawn just before inflation started to pick up to where it is now.

In regards to buying gold coins; I prefer to buy 100-g or 1-oz at a time. I've bought most of it online but any recommendations of where to physically buy ( I live in London)?

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Interesting thoughts on Bullionvault et al, not really thought of it that way, but as Labour have had their hands removed from the tiller I'm less concerned about knee-jerk reactions (albeit I know all politicians are the same). My issue concerns buying silver at 20% VAT is just far too painful, albeit i agree its good to hold physical. Fortunately I travel a lot overseas with work and its amazing what coinage you can pick up which accidentally makes it way back home

In regards to the NSI index linked bonds; I remember them being withdrawn last year (I think?) and the relaunch later this year makes me highly suspicious as it seems to much of a coincidence that they were withdrawn just before inflation started to pick up to where it is now.

In regards to buying gold coins; I prefer to buy 100-g or 1-oz at a time. I've bought most of it online but any recommendations of where to physically buy ( I live in London)?

Re the NS&I bonds relaunch, I would be suspicious too normally, but the goal for NS&I is to raise just £2Bn and the issue will probably be over-subscribed so people should get in quick. I suspect it was pressure from the banking industry that made the govt withdraw them. I can't see inflation falling too much, and anyway, if the goal is protect against inflation then it doesn't matter.

Re PM investing, I don't know why people are put off by the VAT on silver because it is factored into 'second-hand' prices (in the UK and Europe). Also remember that the tax on silver could (and probably will) be raised sharply one day and taxes introduced for buying gold bullion. No good holding bullionvault promises at that point - I'd advise people who have holdings in non-physical to convert it into the real thing.

Edited by Constable

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...

I'd appreciate other HPCers two pence worth as I know there is a wealth of opinions out there in regards to PMs.

Just to add - I would also ignore the VAT on silver issue as if you buy from a dealer + vat then you'll get that back if you sell 2nd hand via fleabay or some such.

Also, don't fixate on just gold and silver. PMs like palladium and platinum are also worth considering. Coins and ingots are also very small and easy to store.

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But surely with bullionvault and goldmoney you can quickly liquidate your account at the click of a button if theres news of a potential government action on metals.

Now silver is going past $40 is it worth jumping on the train or is the smart money phase over?

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But surely with bullionvault and goldmoney you can quickly liquidate your account at the click of a button if theres news of a potential government action on metals.

Now silver is going past $40 is it worth jumping on the train or is the smart money phase over?

Errol's chart above shows you there is hardly any money in silver, let alone smart money.

When the Cash-for-gold turns into Cash for Silver, that's when the smart money is going in, When it turns into Gold for Cash or Silver for Cash, then that's when you sell.

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  • 312 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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