Ed Zimmer's  Instablog

  Wednesdays crash in prices in the PM sector illustrates why investing in anything entails some risk.   The Key is minimize the risk while maximizing the profit.   But one also must look at long term vs short term.    A long term strategy can accept some ups and downs, as long as the long term outlook is up.   Short term is more reliant on the day to day changes.
  When it comes to actually purchasing physical metals, one must remember that there is usually a premium that goes with the purchase, and to sell with a profit, one must recover not only the cost, but the premium as well, just to break even.
  Recent shifts in the metals market have not been that large, and are not enough to cover the premium in silver.   So at the moment, purchase of physical silver must remain a long term investment.    Gold on the other hand has come close to covering it's premium, depending on your source.
   Serious drops like Wednesday are perfect times to lock in some physical silver.  Not a lot, but enough to increase your holdings slightly.   SHould the fall continue, then purchases should be increased as your ability to buy exists.    I do not recommend that anyone go "all-in" in the metals, but buying while the price is falling provides opportunities for the long term investor to see his investment grow in value.

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  Why buy on this dip?    It was a serious retracement, providing an excellent time to purchase from dealers.   Secondly, it comes as the COMEX is reporting registered stocks of silver falling to 47.4Moz as of 1/19/10.   That is a massive 7 Million ounce drop in just 11 days!     Total Silver stocks reported by the COMEX actually increased to 113 Moz, however 65.7Moz of that is silver owned by someone else that is "eligible" to cover contracts, after it is first purchased by the short seller!

This is will be the main thrust of my published post, I just wanted to get some of this information out to those who follow me before hand

  A lot of people want to know how to get rich, preferrably quickly and with little cash up front.    That has pretty much been the dream of every man, woman and child, especially in a prosperous society.    The adage "it takes money, to make money", pretty much leaves the majority on the outside looking in.    As anyone who has tried to play the futures, the buy-in cost is higher than the poker table, and you might have a better shot at the poker pot.
  So how to position yourself to thrive in the coming years?    Believe it or not, the first thing you have to change is your mind.    Not just expectations for the future, but how you view everything about the future.
   What is a "comfortable retirement?"    As many retirees will tell you, they didn't expect to be in "this position" when they retired.    The devestation of savings, retirement accounts and 401K's has changed options for millions and while some have made money on the rebound, many more have salvaged what they can and are still shell shocked.
  Changing the mindset means changing how you plan to end the game of life.   Those that are relying on a steady income from savings and investments now could very easily find those savings evaporating due to devaluation or inflation.   What provides the best retirement?     That is something that everyone should be considering and re-evaluation on a yearly basis.    What I provide is a few ideas to get you started.
   Owning your own property.    This does not mean having a mansion or a piece of prime real estate, but rather the kind of property that you are willing to retire to.   It should require little in the way of upkeep, have property taxes that you can easily afford on a very small income and be the right size for you and yours.    You should own it outright, that way you are not beholden to anyone for more than the taxes.
   Access to Medical Care.   No matter how healthy you are now, you will age.   If you like the country life, you still should be concerned with the type and availablity of medical care where you plan to retire.    Another reason that your property should be easy to keep up so you can spend more time doing what you want and not mowing the lawn
  Expenses vs Income.   Most people center on this as the most important thing, but this is only true if you have a lot of things you need to purchase.    Being able to make your own, grow your own, trade for items and reducing your needs can help turn an expensive proposition into a manageable endeavor.   Insurance can help reduce catastrophic costs, both medical and property.    As we live longer, we need to plan for things that we have no experience with.    To that end, lowering our needs will help lower our costs.
  Learn.    Exercise the mind will help keep you young and in the game.   Not only do the ol' dogs need to learn new tricks, you need to learn how to apply them.   The last thing you want to do is vegetate into the dolrums and get depressed.
  Manage our expectations.   When you are young, anything is possible and the world is your oyster.   When you are middle aged, you worry about everything, even those things that are beyound your control.   By the time you reach retirement, you need to have figured out what is important and how you want to live the rest of your life.    Having expectations that exceed your capabilities at this point, or even in middle age, can result in risks that should not be taken.   The most successful people are those that know their own limitations and don't risk more than they can afford.
  Exercise.   Even if it is only stretches and sit ups, working to keep your body as healthy as possible pays major dividends, better than any investment.   Get out, walk, bike, run, play with the kids, work in the garden, bend, twist, and generally get the body moving.    You don't have to go nuts, just learn to appreciate the outdoors and your body will thank you.
   Changing the mindset is never easy.   Everyone has a different risk appetite, so investing is different for each person.   Planning for the future now, can reap dividends when the time comes.    Don't put all your eggs in one basket, but make sure that the basket is everybit as colorful as the Easter Bunny's.    A little green, some gold and silver and a little earth color can help you enjoy the later years.