Crunching The Numbers

303
Tue, Nov 27, 2012 - 4:04pm

Lately, it seems that a day doesn't go by without me receiving a comment or an email from somebody complaining about how they're "still getting their butt kicked in silver because they bought in April of 2011". Since I've consistently advocated the regular stockpiling of physical metal for over two years now, I thought it might be fun, and worth the time, to crunch some numbers to see just how bad it could be for some folks.

First of all, I don't think that anyone whose only purchases of silver came in April of 2011 is still a regular reader of this site. Additionally, that this disgruntled, non-reader of the site would then take the time to email me seems a little far-fetched. Nonetheless, let's roll with it.

Below is the hard data. I began this blog/site on 11/11/10, so, let's measure two things:

  • A Turdite who decided, based upon my strong convictions, to purchase a tube of eagles every two weeks, regardless of the cost.
  • A Turdite who decided to take $500 out of his/her paycheck every two weeks to purchase as many Eagles as $500 would buy, based upon the current price.
  • I have not included premiums or sales tax. I'll let you adjust and figure that out for yourself.
  • DATE PRICE TUBE COST OR OUNCES BOUGHT COST

    11/12/10 25.94 $518.80 19 $492.86

    11/26/12 26.70 534.00 18 480.60

    12/10/10 28.58 571.60 17 485.86

    12/24/10 28.88 577.60 17 490.96

    1/7/11 28.66 573.20 17 487.22

    1/21/11 27.42 548.40 18 493.56

    2/4/11 29.06 581.20 17 494.02

    2/18/11 32.30 646.00 15 484.50

    3/4/11 35.32 706.40 14 494.48

    3/18/11 35.06 701.20 14 490.84

    4/1/11 37.74 754.80 13 490.62

    4/15/11 42.57 851.40 11 468.27

    4/29/11 48.58 971.60 10 485.80

    5/13/11 35.01 700.20 14 490.14

    5/27/11 37.86 757.20 13 492.18

    6/10/11 36.33 726.60 13 472.29

    6/24/11 34.64 692.80 14 484.96

    7/8/11 36.54 730.80 13 475.02

    7/22/11 40.11 802.20 12 481.32

    8/5/11 38.20 764.00 13 496.60

    8/19/11 42.43 848.60 11 466.73

    9/2/11 43.02 860.40 11 473.20

    9/16/11 40.78 815.60 12 489.36

    9/30/11 30.04 600.80 16 480.64

    10/14/11 32.14 642.80 15 482.10

    10/28/11 34.07 681.40 14 476.98

    11/11/11 34.67 693.40 14 485.33

    11/25/11 31.01 620.20 16 496.16

    12/9/11 32.17 643.40 15 482.55

    12/23/11 29.04 580.80 17 493.68

    1/6/12 28.65 573.00 17 487.05

    1/20/12 31.65 633.00 15 474.75

    2/3/12 32.73 654.60 15 490.95

    2/17/12 33.20 664.00 15 498.00

    3/2/12 34.48 689.60 14 482.72

    3/16/12 32.57 651.40 15 488.55

    3/30/12 32.47 649.40 15 487.05

    4/13/12 31.38 627.60 15 470.70

    4/27/12 31.35 627.00 15 470.25

    5/11/12 28.86 577.20 17 490.62

    5/25/12 28.37 567.40 17 482.29

    6/8/12 28.46 569.20 17 483.82

    6/22/12 26.66 533.20 18 479.88

    7/6/12 26.89 537.80 18 484.02

    7/20/12 27.28 545.60 18 491.04

    8/3/12 27.79 555.80 18 500.22

    8/17/12 28.00 560.00 17 476.00

    8/31/12 31.37 627.40 15 470.55

    9/14/12 34.60 692.00 14 484.40

    9/28/12 34.52 690.40 14 483.28

    10/12/12 33.63 627.60 14 470.82

    10/26/12 32.01 640.20 15 480.15

    11/9/12 32.59 651.80 15 488.85

    11/23/12 34.11 682.20 14 477.54

    If you had purchased a tube of Eagles every two weeks since this blog/site began, you would now own 54 tubes or 1080 ounces of silver. This would have cost you $35,524.80 and your average cost per ounce would be $32.89.

    If you had decided to, instead, buy $500 worth of Eagles every two weeks since this blog/site began, you would now own 810 ounces of silver at an average cost of $32.29.

    If you came late to the party and only began your tube-every-two-weeks extravaganza on 4/15/11 with the price at $42.57, you'd now own 860 ounces at an average cost of $33.50/ounce.

    What if you only bought a tube on 4/15/11 and 4/29/11 and then took the summer of 2011 off? You were then lured back in by the S&P downgrade of 8/5/11 but scared off again after the steep drop in September. Convinced we'd seen the lows by late 2011, you then bought a tube every two weeks in 2012. If so, you'd have 600 ounces of silver at an average cost of $33.23/ounce.

    Maybe you did precisely as above, buying only six times and on those exact same dates in 2011. Then you only restarted buying just as price peaked in late February of this year. You'd now own 520 ounces at an average cost of $33.49/ounce.

    And what if you're just the unluckiest sap on the planet. Dumb as a box of rocks and easily duped into buying only when ole Turd gets over-the-top excited. You made just 12 purchases and you bought on 4/1/11, 4/15/11 and 4/29/11, 8/5/11, 8/19/11 and 9/2/11, 2/3/12, 2/17/12 and 3/2/12, 8/31/12, 9/14/12 and 9/28/12? In that case, you'd be the proud owner of 240 ounces of shiny silver at an average cost of $37.78.

    Feel free to fiddle with these numbers as much as you'd like. Construct your own best case and worst case scenarios. Add in an acceptable dealer premium and your local sales tax. Whatever. Have fun with it. The point is this:

    Your best strategy is to be consistently buying physical metal, either gold or silver, regardless of price. Sometimes you'll buy high and sometimes you'll buy low. Most importantly, however, you'll be slowly accumulating a sizeable position in the only assets guaranteed to protect your savings and purchasing power against the constant devaluation of the dollar, brought upon us by our politicians and bankers.

    BTFD or BTFR, it doesn't matter. Just buy.

    TF

    About the Author

    Founder
    turd [at] tfmetalsreport [dot] com ()

      303 Comments

    silver foil hat pbreed
    Nov 27, 2012 - 7:32pm

    and for pbreed / quisp

    If you can't accumulate that much Ag/Au, remember that all base metals will be worth more. That includes common Cu/Ni coinage.

    In a true hyperinflation scenario, those coins will be 'worth' more than their face value. I'd speculate several times so in terms of paper.

    The question is, will the demise of the (paper and electronic) dollar be replaced by Cu/Ni coinage for the sheeple? Ag/Au for the 'elites' (and those with foresight).

    How about this "reset' scenario?

    Paper currency is rendered worthless (all of it) but coins are now worth 10x their face value in the new monetary system.

    That would be one way for the goobermint to repudiate the debt.... after all, all 'paper' is a NOTE promising future payment of a DEBT, and not money in and of itself.

    'Real Money', still issued by the treasury, is backed by a metal alloy even today.

    Save_America1st
    Nov 27, 2012 - 7:34pm

    Congratulations Turd!!!

    Every week I go to Dr. Dave Janda's Operation Freedom site to download Sunday's podcast to my phone so I have his awesome interviews to listen to during my commute to and from work, etc.

    Imagine my surprise today when I went to download this week's podcast and I see the mighty Turd Ferguson as one of this weeks guests!!!

    Not sure if many Turdites know of the show or knew Turd was recently interviewed, but here's the link for all to download for free!

    https://davejanda.com/operation_freedom/

    Turn's out Dr. Dave is also a huge TFMetalsReport fan as well! How kick ass is that?

    I can't get over hearing people call you "Turd" whenever I hear your interviews, lol Always cracks me up.

    Anyways...great interview Turd...hope everyone downloads it or you should post it on the podcast area.

    Eric Original
    Nov 27, 2012 - 7:38pm

    Sunday Night Massacre

    I'm happy to say I sold a goodly pile of silver on that Saturday before the Sunday Night Massacre. But I can't crow too much because I only did it because of relentless nagging from Mrs. O, and I had to make her happy. If left to my own devices, I probably would not have made it over to the coin shop that day...

    old tradesman
    Nov 27, 2012 - 7:48pm

    katie rose

    ot soft and hard recipe for cheese coming in private message tomorrow.

    The Watchman
    Nov 27, 2012 - 7:49pm

    Those Are HUGE Withdrawals-Very ODD

    From Harvey:

    Silver Ounces
    Withdrawals from Dealers Inventory 1,450,235.75 oz (Brinks)
    Withdrawals from Customer Inventory 918,576.68(Brinks,Scotia)
    Deposits to the Dealer Inventory 297,077.22 (Brinks)
    Deposits to the Customer Inventory 5,051.775 (Brinks,Delaware))
    No of oz served (contracts) 7 (35,000) oz
    No of oz to be served (notices) month complete
    Total monthly oz silver served (contracts) 72 (360,000 oz)
    Total accumulative withdrawal of silver from the Dealers inventory this month 2,792,309.2
    Total accumulative withdrawal of silver from the Customer inventory this month 6,922,612.7
    Bollocks
    Nov 27, 2012 - 7:50pm

    pbreed said...

    "Silver and Gold will likely not increase your real wealth at all, it will just protect your wealth"

    Yes. That's why I'm all-in as fiat currency is a destroyer of wealth.

    Although with the manipulation of the real value of gold and silver that's been going on, it will increase your wealth considerably too, as the currencies really start to collapse.

    silver foil hat
    Nov 27, 2012 - 7:51pm
    steveo
    Nov 27, 2012 - 7:54pm

    Eclipse, dont laugh

    Eclipse and the Puetz Window

    I haven't check his work, but I have noticed some big effect on market near eclipses, also some complete fizzles.

    Gold and Silver "look" like they want to burst upward, NZD/JPY risk on risk off indicator looks ready to complete its move to the blimp and get swatted down. But Cable still looks like it wants to move up.

    https://oahutrading.blogspot.com/2012/11/eclipse-and-puetz-window.html

    atarangi
    Nov 27, 2012 - 7:57pm

    Illusions of perception versus the facts - - -

    Silver up 800% Gold up 550% Hope is not a great strategy. Anyone holding gold over silver is selling themselves short. Stick with the winning (silver) trend. Silver is the quiet achiever. Anyone who sells silver to buy gold is certain to regret it. The gold/silver ratio could realistically end up one to one due to the lack of real silver in the market. The beach ball is being held under water and its holder is starting to tire.

    ¤
    Nov 27, 2012 - 7:58pm

    Argentina On Cusp Of Default...Again

    Want to talk about inflation? Keep your eye's on Argentina.

    CDS Chart Could Portend More Pain For Argentina ETF

    This is gold priced in Argentine dollars per gram.

    Argentina Rating Downgraded by Fitch on ‘Probable’ Default

    By Katia Porzecanski - Nov 27, 2012 5:12 PM ET

    Argentina’s credit rating was cut by Fitch Ratings, which said a default is probable after a U.S. judge ruled the country can’t make payments on its restructured bonds unless it pays holders of defaulted debt by Dec. 15.

    The rating on Argentina’s international law bonds was lowered to CC, eight levels below investment grade, from B, Fitch said today in an e-mailed statement. It cut the rating on bonds sold under Argentine law to B- from B.

    U.S. District Judge Thomas Griesa ruled on Nov. 21 Argentina must deposit $1.33 billion for creditors who rejected the terms of the country’s two debt restructurings before it makes a $3 billion coupon payment to holders of performing securities next month. Fitch said the country’s failure to make a payment on warrants that are linked to economic growth would be considered a default on the country’s other debt securities issued under international law.

    “The downgrade of the long-term foreign currency IDR reflects Fitch’s view that a default by Argentina is probable,”Lucila Broide, an analyst at Fitch in New York, said in the statement.

    Yesterday, the Argentine government and holders of the country’s restructured bonds asked a federal appeals court for an emergency stay to block the judge’s orders. In an e-mailed statement, the Economy Ministry said that Griesa’s decision is unfair and that a scenario where holdouts seek equal terms as investors who accepted swaps in restructurings could be debated in Congress.

    Speculation that Argentina will halt payments on performing bonds rather than pay the holdouts has made its debt the costliest in the world to insure against non-payment, according to credit default swaps. Argentine dollar bonds have plunged 13 percent since Griesa’s decision, JPMorgan Chase & Co. indexes show.

    https://www.bloomberg.com/news/2012-11-27/argentina-downgraded-by-fitch-...

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