Crunching The Numbers

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.

    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.


    About the Author

    turd [at] tfmetalsreport [dot] com ()


    Nov 27, 2012 - 8:01pm

    OK, I'll weigh in here

    My overall DCA for silver is $37.85... yeah, I was "that guy" a few times. My purchases were sporadic, and I bought lots at the "wrong" times. Oh well.

    My 2010 Average buy price was 29.24

    My 2011 Average buy price was $40.03

    My 2012 Average buy price (so far) is $35.04

    Do I care? Not really. Yes, I got a bit excited in August of 2011 and bought when I should have held, oh well. I'm older and wiser now.

    I also have bought a few "numismatics" that were way overpriced. Of course, I knew that, I just wanted a few "pretty" coins, so I don't consider those as much an "investment" as the rest. I could recalculate to remove those, but frankly, that's probably only 10 or 15 ounces out of the lot, so it won't affect the averages much.

    I never expected to sell soon anyway, I will hold until until all those folks who tell me I'm crazy start asking me how to buy the stuff, then I'll start considering when to exit this investment and change it all to gold and/or land. By my calcuations, given the current premiums, I'm down about 5% overall on silver. But my thesis from early this year still holds true: Any PM's I've held longer than 2 years are above water, significantly so. It's only the stuff from mid-2011 (and a few ounces I bought in September this year) which are under water.

    Funny, every ounce of gold I've ever bought is showing a profit (and has been almost all year). Of course, I don't buy that as often, even though I have more fiat sunk into gold than silver at this point.

    I've also converted all my 401K assets into the sprott funds over time. They're about the same averages as my physical.

    Turd's got me thinking, though, maybe I should go on the bi-weekly or monthly purchase plan... Looks like a winner overall, and less excitement.

    But I'm a true believer in the end of the great keynesian experiment, so I'm holding fast, and have no ill will toward folks like Turd, just the opposite, in fact.

    Keep Stackin'!

    ETA: I guess this means I'm one of the "Dumb as a box of rocks" guys!!! LOL!

    Nov 27, 2012 - 8:06pm

    Relative wealth - - -

    It is true that gold and silver may not increase the wealth of its holders. Those who don't hold it could end up with nothing.

    Nov 27, 2012 - 8:14pm

    What What What ????

    old tradesman to katie rose:

    "soft and hard recipe for cheese coming in private message tomorrow"

    Secret cheese recipes being exchanged at Turdville????

    We can't have that going on!

    Cheese can be a killer. Everyone needs to be included in case there's some dodgy shenanigans going on behind the scenes.

    I hope all Turdites agree. This is serious.

    Nov 27, 2012 - 8:26pm

    Suppose you decided to start

    Suppose you decided to start a long term savings plan denominated in silver. And suppose you started at the worst time, bought $3,000 of 90% silver at each year’s high, and over paid. 33 years later (but not including this year)...

    mack Bollocks
    Nov 27, 2012 - 8:35pm

    do not cut that cheese

    could be aromatic!

    Nov 27, 2012 - 8:38pm

    Check this chart

    Courtesy of some guy named Nick Laird and lifted from the Harvey Organ Report.

    Pretty much says it all!

    Somebody ought to send this off to Thunderlips and get his "expert" opinion.

    Nov 27, 2012 - 8:53pm


    He can't talk about that as it is part of the ongoing (ie. into perpetuity) investigation.

    You don't want to jeopardize that, do you?

    And besides he only works for that toothless little regulatory agency that is part of the federal government that works for the banks. Who are those small position traders?

    Interesting graph nonetheless.

    my mothers keeper fertzeltwist
    Nov 27, 2012 - 8:57pm

    john wayne

    to hear tell, he was in fact a stacker, and helped tulving get started...

    Nov 27, 2012 - 9:04pm

    Nick Laird

    Runs some chart website with some pretty cool charts, has free 3 week membership or something like that. Also has really interesting free charts that are hard to find, my computer broke a few weeks ago so I don't have links (except intraday one below that was in one of my emails) until I load data from old broken computer to new computer, which I really hope arrives tomorrow, going through really bad charting withdraws.

    Nov 27, 2012 - 9:06pm

    John Wayne - 'Silver' Screen

    Rancher Tim Clark borrows money from Bob Russell, who then rustles Clark's cattle so he will be unable to repay the money. Thus Russell is able to cheat Clark out of his ranch.

    Clark becomes a prospector for silver and ultimately comes to settle accounts with Russell and crooked deputy Bendix.

    Video unavailable
    Mr. Smith
    Nov 27, 2012 - 9:12pm

    Are Gold and Silver Prices at "Truely Fair Values"?

    Many of us find it difficult to determine if gold and silver are correctly valued today. One would suspect that corn, pork bellies or cocoa are as they trade in open markets with many participants on the long and short side. The precious metals may be different. As they have been mediums of exchange and valuation in the past, there is reason to suspect today that the true pricing is unknown because of covert manipulation of prices. Thus we may not safely assume that the relative value of silver or gold to houses, food, gasoline, etc. will remain the same in coming years. If the prices of the precious metals are suppressed, then purchases today may leap in value far beyond suspected inflation rates into the future. One might also investigate comparative suppression between gold and silver. Today the ratio is north of 50; yet the elements appear in nature from 16 to 10 to 1. If the ratio of the elements in the earth's crust returns, then buying silver today is a levered bet. The fact that silver is consumed in manufacturing increases the leverage. If one is comfortable with counterpart risk, then purchases of futures, options and mining shares, are traditional ways of securing leverage. But, unknown events could already be providing leverage.

    I am thus inclined to buy.

    old tradesman
    Nov 27, 2012 - 9:15pm

    cheese recipies

    That would be my wife. In which are you really interested on main street? My wife will be putting out the information tomorrow. By the whey(pun intended) father and grandfather cheese makers.

    sorry off topic should have went to churning or still churning I apologize. ok thats butter. oldtimers kicking in again

    for old time cheese recipes lets keep it off main street. Pm me If your interested its alot of different processes to get just one cheese. Therefore I believe I will have my wife in contact with katie rose for her specifics and katie can share the results with every body.

    Nov 27, 2012 - 9:33pm

    probably reading too much into it

    pardon my megalomania, but I hope my comments over the weekend did not serve to catalyze this thread.

    I made my own decisions to buy SLV in the mid-40's and hold no one, including, Turd, responsible. I make my own decisions.

    Despite that lofty entry point, I still plan to make a substantial profit on SLV, EXK, GPL, HL, and phys silver and gold.

    Guess what I'm saying is, if I ruffled the Turd, that was never my intention. I hold Turd in high esteem.

    El Gordo
    Nov 27, 2012 - 9:39pm


    What's wrong with you? Don't you know that no one is responsible for his own actions in today's America? It must be someone else's fault, no matter what. Oh, wait, I see you live in Texas. Now I understand.

    Nov 27, 2012 - 9:42pm

    No ruffled feathers

    Please understand, this post was not written in anger or frustration. I just thought it was a fun exercise.

    Fat Willie
    Nov 27, 2012 - 9:48pm


    Bill Murphy recently reiterated that the silver scandal *may* break before xmas. I know you have been extremely consistent with your optimism, though frustrated by the timing. Have you heard anything along the lines of Murphy's most recent interview? I think it was on unconventional finance or something.

    As always, thank you for all you do.


    TexasStacker TF
    Nov 27, 2012 - 9:49pm

    have to admit, I giggled a

    have to admit, I giggled a little when I typed "ruffled the turd." Not a good visual.

    Thanks for this site and all you do to maintain and preserve it.

    Fat Willie El Gordo
    Nov 27, 2012 - 9:58pm


    Having lived in NJ, PA, WV, OH, and TX, and having traveled all over the damn place, including a lot of time in Europe and Asia, I really do believe TX is one of the best places to live. If you get a chance to live here, it is well worth considering. Great cost of living, no state income tax, above avg government hacks.... Although, the way things are going, Americans might need a passport to come here soon..........


    Nov 27, 2012 - 9:59pm

    a visual of what derivatives will do to the financial world

    <iframe width="640" height="360" src="" frameborder="0" allowfullscreen></iframe>

    Nov 27, 2012 - 10:03pm

    Silver Investing News

    GFMS: Silver Industrial Demand to Reach New High in 20141

    Tuesday November 27, 2012, 4:15am PST

    By Michelle Smith2 - Exclusive to Silver Investing News3

    Investment demand for silver often takes center stage, but industrial demand should not be overlooked. In 2011, industrial demand was strong for the first three quarters, but then saw close to a 4 percent decline and fell sharply towards year end. A newly released report5 from Thomson Reuters GFMS states that the Silver Institute commissioned GFMS to conduct an investigation against a backdrop of uncertainty carried over from 2011 to 2012. The results reveal a decline and recovery cycle that will see industrial demand reach a new high in 2014.

    GFMS states that not only does the industrial sector play an important role in consumption, but it is also crucial in offsetting the declining use of the white metal in photography and silverware. These two segments accounted for over one-third of silver fabrication demand in 2000, but fell to only 13 percent in 2011.

    At the turn of the the millennium, industrial offtake of silver was 383.3 million ounces (Moz). Over the past decade, demand has risen on all but two occasions. The bursting of the dot-com bubble led to a pronounced drop in 2001, although a recovery phase quickly emerged the next year, notes GFMS.

    Then in 2009, there was a recession-induced decline that eclipsed that of 2001. Again, recovery was seen the following year. In 2010, industrial demand hit a new record high of 499.6 Moz.

    One of the questions the Silver Institute aimed to answer in commissioning the report was whether current conditions will be a repeat of 2009′s downturn. The GFMS report reveals similar conditions are at hand.

    With an expected decline of 6 percent in 2012, industrial demand will fall to about 454.4 Moz, states GFMS. Recovery is expected to begin as we approach year end and should carry over into 2013. Modest growth next year should boost offtake to 484 Moz. In 2014, GFMS forecasts a further rise of about 6 percent, paving the way to a new record high of 511.6 Moz.

    Drivers of rising industrial demand

    One of the factors driving the forecasted improvements is demand for ethylene oxide. The production of that and other intermediaries will help the US run counter trend to other industrialized nations, which GFMS predicts will see slow growth.

    The largest end use of silver is the wide-ranging electrical and electronics sector, states GFMS.

    “The most rapid growth in these sectors is set to come from emerging markets such as India and China, where rapid advances in living standards mean such products have become increasingly more affordable as well as desirable.”

    In absolute terms, GFMS expects China to achieve successive record highs in terms of its industrial offtake of silver over the forecast period....

    old tradesman
    Nov 27, 2012 - 10:23pm

    It starts with just one man

    Hat tips to the deputy sheriff! sorry for off topic but my family has to fly alot.

    Nov 27, 2012 - 10:26pm

    Harvey's Up!

    Ted Butler says JPM holds 34% of the short OI in silver. The CME can work around the force majeure at Manfra by delivering from other vaults, but there is a lot of gold in Manfra and the OI on Comex that could stand for delivery is huge. Turkey is getting Lira from Iran and buying gold for Iran. All this and more on the Harvey Report:


    Nov 27, 2012 - 11:01pm

    What will happen to the EE

    Video unavailable
    Nov 27, 2012 - 11:02pm

    just bought a silver water pitcher

    Very near melt value, as a Christmas gift for the family. Plan on using it every day. I'm hoping for some health benefits. Maybe it will have a placebo effect. Regardless, it's my way of looking at 'the shiny' daily. Still looking for some decent goblets to use daily. I got sniped on two beauties tonight on ebay. Anybody else use silverware or cups daily?

    Nov 27, 2012 - 11:07pm

    As Katie Rose pointed out

    Prepping cost more money than I thought..........While PM's are at the top of the list, so are guns and ammo, these cost are rising as ammo is once again on a springboard. Just a few months ago I could by the ML855 for the AR's for less than 150 a can, now you can't buy half of that for the same money.

    My gun stacking cost is just under my PM cost, not to mention the amount of ammo I have bought to keep up, puts it over the top......reloading cost is also on the rise. What do ya do, spend 30k on guns and ammo to help protect your 25k in PM's, 6k+ in food, then you have bows and arrows.....a good arrow will set you back 20+ per......cold weather gear add in another 3-5K.........this list never ends, as does the nagging from the little lady thinking I lost it.

    At least I hit the last big silver purchase over the summer at around 600 per tube, and have since converted that into 90%...........for some reason I keep diverting to 90%, I just have a feeling this is where I should have most of my silver.....for the Numi value in case we are all wrong (sarc mostly). I am now at 30+ in my .999 and around 19-20 in my 90%,just more oz's for the money in 90% for me.

    Bottom line..........prepping ain't cheap even if you have an extra grand a month, but it's just gonna keep going up as inflation takes hold.

    Buy when you can........Sell if you must!

    Nov 27, 2012 - 11:12pm

    A problem perhaps

    People need to realize that gold and silver are more likely to increase from debt ceiling increases as opposed to QE. You need to understand that there are probably 2-3 hundred trillion Federal Reserve notes floating out in the world. This means the Fed could print 20 trillion a year with maybe 10% inflation.

    Hyperinflation is not a certainty. Hyperinflation needs a rather small monetary base to begin with. Something that can double or triple in about a month. The Federal Reserve note doesn't qualify as being a part of a small monetary base. People need to chill out. We have a lot more time before economic collapse, 5-10 years, to prepare. Keep stacking STEADILY. Don't freak out. Learn a trade. Learn to grow food and raise some chickens. Educate others carefully and be happy.

    fast mover Fat Willie
    Nov 27, 2012 - 11:17pm

    @Fat Willie

    "Although, the way things are going, Americans might need a passport to come here soon"

    We can only hope. Maybe we should have a "re-education class" on State's rights (Amend 10) and personal freedoms for the immigrants moving here.


    The Watchman
    Nov 27, 2012 - 11:22pm
    treefrog rpboxster
    Nov 27, 2012 - 11:23pm


    several years ago, i found a sterling "ewer" or water pitcher that was engraved as a gift to a canadian banker on his retirement. evidently he (or his heirs) had sold it, and it ended up in a second hand store. i jumped on it at a price a little under melt at the time (about $5.00/oz). it has been a kitchen fixture ever since. it holds just enough water to fill my coffee maker. it sits, full of water on the stove to add to whatever i'm cooking. i don't know if there are any health benefits due to the ewer, ....but i haven't had many colds lately.

    Nov 27, 2012 - 11:25pm

    Wouldn't a silver plated pitcher…

    …work as well? I have one of those.

    I mean the water would still be 100% in contact with silver so wouldn't that give the same benefits as a sterling pitcher? And if not, why not?


    Donate Shop

    Get Your Subscriber Benefits

    Exclusive discount for silver purchases, and a private iTunes feed for TF Metals Report podcasts!

    Key Economic Events Week of 5/20

    5/20 7:00 pm ET CGP speech
    5/21 10:00 ET Existing Home Sales
    5/22 2:00 ET FOMC minutes
    5/23 9:45 ET Markit PMIs
    5/24 8:30 ET Durable Goods

    Key Economic Events Week of 5/13

    TWELVE Goon speeches through the week
    5/14 8:30 ET Import Price Index
    5/15 8:30 ET Retail Sales and Empire State Manu. Idx.
    5/15 9:15 ET Cap. Ute. and Ind. Prod.
    5/15 10:00 ET Business Inventories
    5/16 10:00 ET Housing Starts and Philly Fed
    5/17 10:00 ET Consumer Sentiment

    Key Economic Events Week of 5/6

    5/9 8:30 ET US Trade Deficit
    5/9 8:30 ET Producer Price Index (PPI)
    5/9 10:00 ET Wholesale Inventories
    5/10 8:30 ET Consumer Price Index (CPI)

    Recent Comments

    by Alex777, 1 hour 29 min ago
    by stealthbear, May 22, 2019 - 11:53pm
    by Sound Money Minnow, May 22, 2019 - 11:48pm
    by Joseph Warren, May 22, 2019 - 9:57pm
    by NW VIEW, May 22, 2019 - 9:48pm