Thursday, March 3, 2011

Gold & Silver: Take the Money and Run!

(May 16, 2011 update: All future stock posts will appear on my new subscription-only website at Please visit!)

I've been investing for over twenty years, and one of my fortes has been the ability to remove myself from the emotion of an investment market and judiciously buy and sell based on reality, not based on fear or greed. Junk bonds in '89 and '91; U.S. Treasury bonds in '95; European stocks in the mid-90's; tech stocks in the late 90's; oil, real estate, gold & silver in the last decade -- I either sold high or bought low, but never the opposite.

There are investments, and then there are gambles. You know the difference between the two when every investment magazine and website is touting the same financial asset; in this case, gold and silver. When every Harry, Dick and Jane owns the same asset, it is time to get out. Didn't we just learn that lesson with real estate? And how many months later did everybody start repeating that mistake with precious metals?

"But it's different this time!" Only a novice speaks like that, and it is always the novice investor who gets caught holding the bag when the investment du jour finally starts to fall. Mutual fund managers have seen markets rise and fall. They know how to handle frighteningly high markets. So do investment firms, and pension fund managers, and families with generational wealth. They will all sell their gold and silver before novice investors do, and that will drive the price down....way down. And the novice will appear as a deer in the headlights, looking back at the profits which just disappeared, and wondering how on earth they salvage their investment.

I already cashed in my gold and silver gambles. I am not greedy. I am happy that I made money in them. I have never looked back to see what price I sold at and whether the price went even higher. It's a moot point. People gamble to make quick money. If it works, God bless them. If it doesn't work, they get spanked, don't they? And hopefully, they will learn lessens from their forays into the financial markets, so that the next time the investment du jour goes up a ridiculous amount, they are wise enough to take the money and run.

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I am not paid to promote nor disparage any investment. My recommendations are based on hypothetical situations of what I would do, not advice on what you should do. The information provided herein is obtained from sources believed to be reliable but is not guaranteed as to accuracy or completeness. Investments are risky, and can go down in value. Past investment results are not indicative of future returns. I am not a licensed investment advisor nor a tax advisor. Consult with a licensed investment advisor and a tax advisor to determine the suitability of any investment. This is not a solicitation to buy or sell any security.


The Right Huff is Crista Huff's blog for politics and items of sociological or financial interest. Crista Huff also managesGoodfellow LLC, a subscription-only stock market website. We strive to identify financially healthy companies in which traders and investors can buy shares and earn dividends and capital gains. See disclaimer for the risks associated with investing in the stock market. See your tax advisor for the tax consequences of investing. See your estate planning attorney to clarify beneficiary and inheritance issues associated with your assets.

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