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The Old Lady At The Coin Shop

I was 18 years old and starting to wonder about my journey in life. I could do a lot of things. I could go to college and get a degree, become an electrician or carpenter like my dad. I could start a business doing something and of course invest all my profits from my career into a man cave where I could watch football, baseball and basketball until my heart was content.

Well, you guessed it. I am still working on that man cave and still looking for the profits. There were a few things I did not know when I was 18 (ok a lot of things). I did not know about inflation, fiat currency and women. I will leave the relationship part out of this blog to spare you. "Inflation" did not really make sense to me and I thought it was mostly related to tires and I thought "fiat" was a car.

The good thing about my 18th year was I learned about a local coin shop. For some strange reason, I loved looking at coins and simply holding them in my hand.

The coin shop was musty and actually a bit scary. I felt like I was entering a different world. Then there was the old lady. She was probably not that old but she looked ancient to me. She would have this little eye piece and almost always be hunched over a small desk looking at a coin.

She would look up when I came in and give me a smile. "Let me know if I can help you" she would say and then walk over to a case and pull out some silver quarters or dimes and lay them on the counter. I guess she knew I did not have much money so would lay out things that were not very expensive.

I would walk over to the counter and she would begin to explain that these silver coins were not like the ones in my pocket. These actually had "real" silver in them. "These coins were real money", she would say. She explained to me that silver and gold had intrinsic value and would always be worth something. "You need to buy these" she would say.

I would pull out a few dollars and buy a couple of dimes or a quarter. I told a few people what I was doing in buying these coins and they quickly told me it was a waste of money. Those old quarters and dimes should just be melted down. Silver was pretty much like iron or brass. There was just too much of it. What I needed to do, they would tell me, is invest in stocks. There are these new things called Mutual Funds. You should put your money there.

I look back now and I see the wisdom of that old lady in the coin shop. I invested in Mutual Funds and diversified as it was proper to do. I moved money around and made some as I went along. More often than not, I was so well diversified I did not make anything but maintained.

However, those silver coins that I kept buying over the years have been one of the most consistent preservation investment/investments I could have ever made. The moral of this life story then is, "Go spend some time with the old lady at the coin shop". Better yet, take your kids to the coin shop and just spend some time explaining the difference between fiat currency and real money.