Gold or Silver

[mikem317]

I tend to like Maple Leafs, then Eagles, then old coins. The old coins are good because many of the things you'd want to buy will cost less than an ounce of silver, so just having tons of Eagles makes it hard to trade. Old coins give you an important ability to trade set amounts of silver in known purities and quantities.

I think that in a SHTF scenario, the old coins would do okay. Initially, sure, 99% of the people probably won't take your old quarter. But those are probably the same idiots who would still take cash. When it comes down to it, silver and gold have always been accepted as currency, and should paper currency fail, the coins are still worth their weight in silver and would come to be viewed as desirable once credit and paper money were no longer accepted. As Rob says, I see the coin, and I know it's 90% silver, or 40% silver, and then we can negotiate what we think it's worth in trade.

That's why I tend to stay away from numismatics. They're nice, precious and have a lot of history, but I'm describing a different coin collector. The coin collectors on this board are probably more concerned about sustained high-inflation or a hyperinflationary event where the FED notes become worth bunk.

I guess the good thing would be we could all pay-off our paper debt, be it mortgage, school or car/truck debt with just a portion of one paycheck! The only problem would be trying to come up with money for milk if it's selling for $100 a gallon.

 

[BenDover]

Disagree with some of this. Raw land does you no good without doing something to it. If you think you're gonna bug out to your 50 acres with some garden tools, tent, guns, and some freeze dried foods then you are setting yourself up to fail.

Driving 6-10 hours round trip to northern NH or ME is gonna get old fast and take forever to get anything going unless you hire local contractors...is that really a good idea?

There are places in western MA and western southern NH with acreage and are affordable (less than 50K, and some less than 30). Are you out of range of the golden hoard? No but neither is northern NH or ME...in a total mad max meltdown no where in new england is really safe.

If you pick a place an hour or so commute from home in a rural area and develop it with gardens etc you are covered for many SHTF scenarios.

Be sure you don't explain your purchasing of land as "We need some place to go when the EMP nuke goes off over the country"; that usually doesn't impress them. You're on the right track by selling it as "vacation" land, but you're also right that it isn't very believable if you're buying in Leicester (which I know nothing of, but it is spelled similar to Leominster and I know for sure you wouldn't want to vacation there!) Skip MA entirely. NH or Maine are where you want to be, and Maine is far cheaper with more opportunities for land you can afford with mountain views. While land for purely practical purposes (place to live, keep neighbors at a distance) doesn't have to be "vacationy" looking at all, your potential land purchase will sell better if you look for features that you'd expect in a vacation retreat. So, look for land that has potential mountain views or even lake views once some trees are cleared. And, a scenic brook running through the land is good to have; it also provides water which you'll want, maybe even some fish, but it adds much value to land being used as a vacation retreat. Also, the neighbors should be building cabins, not McMansions... nobody wants to vacation in a cul-de-sac.

 

[Sprocket]

BOTH!

 

[excoastie]

Prepper, land is not an asset in the strict sense of the word. An asset put money in your pocket. A liability takes money from your pocket. So, if the land takes $1 more from your pocket than it put is, it is a liability. I am probably the only Realtor that’ll explain that a home or land is not an asset… until you sell it at a profit. I understand your thinking, but if the cash flow associated with the land flows from your pocket to another pocket it is a liability. But how many people felt that their home was their biggest ‘asset’ have since been foreclosed upon because they couldn’t make payments. Stop making payments for six months and that’ll prove to whom that home or land is truly an asset… the bank.

And you are correct… precious metal might be worthless if the SHTF, but I doubt it. Someone will always trade for silver or gold. But before ‘investing’ in metals, buy food, water purification and brass. These are my priorities.

 

[green_metalflake]

I’ve been looking in MA but it is tough to tell the wife that we have ‘vacation’ land in Leicester. So I am now calling it ‘hunting land’ in NH. And no, she isn’t buying my new, improved descriptions.

Priceless!

 

[green_metalflake]

That's why I tend to stay away from numismatics.

You'd be surprised how often foreign numismatic silver sells at or below bullion melt value. That is the ideal circumstance because you have both the numismatic value and the bullion value combined. Repeatedly and at coin shops specifically, the focus is on US coinage with foreign virtually ignored. You'd be surprised what you find in their showcases and at what prices. You cannot do this without a Krouse manual. It gives you mintage and metal content for virtually all foreign coins and is the size of a phone book.

 

[Prepper]

Disagree with some of this. Raw land does you no good without doing something to it. If you think you're gonna bug out to your 50 acres with some garden tools, tent, guns, and some freeze dried foods then you are setting yourself up to fail.

Driving 6-10 hours round trip to northern NH or ME is gonna get old fast and take forever to get anything going unless you hire local contractors...is that really a good idea?

There are places in western MA and western southern NH with acreage and are affordable (less than 50K, and some less than 30). Are you out of range of the golden hoard? No but neither is northern NH or ME...in a total mad max meltdown no where in new england is really safe.

If you pick a place an hour or so commute from home in a rural area and develop it with gardens etc you are covered for many SHTF scenarios.

I never said I'm not doing anything to the land. I am doing stuff, but it will take time to be complete. That is fine, since I do not live in a daily fear that at any moment the world will end and I will have to leave NOW. It could happen, but I'm planning to bug-in here in the suburbs until I have actually gotten everything ready up there - I am far better off here with everything that I have, rather than in the woods with whatever I can fit in the truck. Plus, I need the time anyway to plan out all the details so that it is done just to my liking. For now, it makes a beautiful retreat spot that I do not get tired of going to for the weekend. If that is all that it ever turns out to be, I am happy with that, but my ultimate goal is to be off-grid and live there.

Yes, hiring local contractors IS a good idea, and that is what I will be doing for the big stuff; the economy up there sucks and they are happy for the business, plus they charge less than hiring someone in MA to drive up there and rent a hotel for the duration of the job, and I cannot realistically do major construction projects on my own far away.

I'm not too worried about hoards fleeing cities. They may do that, but I can't use that as an excuse for not having a retreat somewhere. Anywhere I go, someone somewhere could try to flee there. My place is very remote so I don't envision anyone getting up that far. If that happens, we'll figure it out when it happens. The woods is very thick making bushwhacking noisy and unpleasant, forcing city dwellers to have to walk right up the roads exposed to anyone who could be watching for them. I'll leave it at that.

 

[Prepper]

Prepper, land is not an asset in the strict sense of the word. An asset put money in your pocket. A liability takes money from your pocket. So, if the land takes $1 more from your pocket than it put is, it is a liability. I am probably the only Realtor that’ll explain that a home or land is not an asset… until you sell it at a profit. I understand your thinking, but if the cash flow associated with the land flows from your pocket to another pocket it is a liability. But how many people felt that their home was their biggest ‘asset’ have since been foreclosed upon because they couldn’t make payments. Stop making payments for six months and that’ll prove to whom that home or land is truly an asset… the bank.

And you are correct… precious metal might be worthless if the SHTF, but I doubt it. Someone will always trade for silver or gold. But before ‘investing’ in metals, buy food, water purification and brass. These are my priorities.

Okay, I don't know exactly what terminology is best. But, as I continue to earn an income (hopefully), the income has to go somewhere. My income is currently twice what I need to pay expenses, and I hope to cut expenses even more so that the ratio gets even better. I don't want to just waste money on stupid stuff. Nor do I want to keep it in $1 bills and put it in a big pile and roll around in it giggling uncontrollably. Some money in a bank account is fine, but eventually a bank account balance is big enough that one should be worried about it... $20,00 I'm comfortable with, $100,00 I'm not. So, it has to go somewhere. PM's are one good place to go, up to a certain point... having 100% of wealth stored there is not such a good idea. Land is another good place to put it, which is one of my motivations for buying land; I like land as its maintenance costs (taxes) are low and it should not go down drastically in value [even if it does, it is still the same amount of land]. I have nearly all the food, ammo and other things I could reasonably justify getting.

Many of the sheeple a few years back were putting excess income into their houses by building fancy kitchens that they never use because they eat out all the time, and adding sun rooms, etc. only to get foreclosed on. I even made some of my own improvements to my house, and in the end it turns out it didn't add any value to the house. I bought in 2000, added $40,000 worth of work over the years to it (other than just maintenance), and the house is now worth what it was in 2000, and still dropping. I like my improvements since I think the house really needed them, but the bank's appraisers don't give a crap about them. If I could do it again, that $40,000 would have completely built the cabin in the woods and I could be living in it now.

 

[excoastie]

Prepper, if you earn twice what you need, keep doing what you’re doing! That is excellent. ‘Dumping’ money into land is not a bad idea. We are not ‘making’ more land! Also, depending on the type, layout and what the land can be used for, you can end up with a gold mine. And, if times get tough, you can always sell it. And now is the best time to buy as it is a buyer’s market and few people have the resources to buy land.

The reason that I try to help people understand asset versus liability is because so many real estate ‘experts’ try to convince buyers that land and their home is an asset. And I believe that people ought to fully understand what they are doing when buying land, homes and income property. I don’t mean to be a dick over the difference between asset and liability, I just know that so many people bought homes that they could not afford under the misimpression that they were buying an asset. When, in reality, they bought a financial anchor.

And you are correct, people took out 2nd mortgages to put in kitchens, baths and pools only to find out that they are now upside-down on their mortgages. They were foolish (mostly). My rule of thumb is - don’t do an upgrade to a property unless that upgrade will add 1.5 times the investment to the value of the property… or if you just can’t live without the improvements. 1.5 times is a good return on your investment. Of course sometimes there are some improvement one has to do in order to sell the property but we try to keep those to a minimum.

Anyway, keep on truckin’! You seem to have it together when handling money so you probably make sound real estate choices, too.

 

[Rob Boudrie]

Of course sometimes there are some improvement one has to do in order to sell the property but we try to keep those to a minimum.

Just about any property will sell if priced properly, so what you are really talking about is an upgrade that will enable the owner to sell the property at a better price - so it would, in fact, be an upgrade adding to the property value.

Only the economically ignorant people (and you no doubt see a bunch) believe stuff like "My home is worth $X, there is just a shortage of buyers now, the value has not gone down".

 

[Rider]

Nor do I want to keep it in $1 bills and put it in a big pile and roll around in it giggling uncontrollably.

This is really under-rated. Although, I prefer a pile of $20's, and to sit in the middle of it, throwing handfuls in the air and laughing maniacally. When I was young, I'd watch Scrooge McDuck swimming in his money vault and think, "I want to be him when I grow up!" ;p

@excoastie - I'm right there with you. My experience has been that people don't really want to understand the financial or economic theory behind something if it means they don't get to do what they want to do. A couple of years ago, I was looking at a vacation property. The market was hot, there was a condo that was just right, but there was no wiggle room. I would have to have it rented 75% of the time at minimum, and hope nothing else went wrong. Given my correct prediction that the economy was going to implode, we didn't pull the trigger. There are now thousands of units available for half what they were selling for 4 years ago, and rental occupancy went from 80% to around 50%. So for a couple of years I'd be that cool guy who owned a house on Maui, and today I'd be that poor bastard who lost everything because he was stupid.

While my bride still loves Hawaii, I am looking for a big piece of land that won't tie up so much capital, and if we go on vacation, we can rent someone else's tastefully decorated money pit.

 

[excoastie]

Rob, we agree! Some people feel that their homes are worth more than the market dictates. These people can usually do small, inexpensive upgrades to add to the curb appeal and help it sell. The improvement doesn’t really add to the value but instead, just makes it look less unappealing.

Too many people feel that their homes are still worth what they were four or five years ago. They feel that their value stayed the same while the only other guy’s home values fell. But in a buyer’s market, the buyers determine the true value of the property.

Rider, good, you refused to make an emotional decision on a business transaction. And now, if you really wanted to buy a condo there, you could save yourself a lot of money.

 

[Rob Boudrie]

But in a buyer’s market, the buyers determine the true value of the property.

The buyers determine the true value in any market

What I see happen frequently (and I suspect it what is going on next door to me) is the homeowner will interview several agents, and select the one who suggests the highest listing price. The agent knows it is unlikely to sell at that price, but also realizes it is the only way to get the listing - so the listing is accepted in the expectation that the seller will reduce the price once they see no action for a few months. This is why I tell any listing agent that "any significant price drop will be accompanied by a change of listing agents, so please be realistic about the price" when I list my residence for sale.

 

[excoastie]

Rob, buyers do determine the price BUT during a seller’s market, buyers are not thinking so they panic and bid more than they ought to bid. But I like the way you think! If you ever want to sell real estate, you have a place to hang your license. I respect people that think differently than the rest of the crowd.

I do not like agencies that ‘buy’ listings. I do not ‘buy’ a listing. I will not take a listing unless I believe I can sell it for around the list price. I have passed on a $1.8M listing from a friend because the home was only worth $1.2M. I refused to list it @ $1.8M. And he found someone to list it for $1.8M and it stayed on the market for over a year. And when it sold, it went for… you guessed it… $1.2M. So I lost out on the very large commission BUT I retained my integrity! And that, money cannot buy! And funnier still, the listing agent used a lockbox! A lockbox on an over $1M listing! I do not use lockboxes on $100k homes! Forget about +$1M homes.

 

[Rob Boudrie]

. And when it sold, it went for… you guessed it… $1.2M

If the agent who listed it for $1.8M and wasted the year of the seller's time got the sale, the seller was an idiot.

I respect people that think differently than the rest of the crowd.

Read the introduction to "The Prince". Machiavelli makes a great statement which reflects much of my philosophy of life - paraphrasing from memory "I am describing things as they are, not as I or anyone else would prefer to see them".

 

[excoastie]

"I am describing things as they are, not as I or anyone else would prefer to see them".

+1... amen to that!