[rseiser]

Powayseller,
Cellar Coin in Pacific Beach was mentioned here before, and I also like the guy.
Good point regarding storage, I would definitely not keep more than a few coins at home. Safe deposit boxes at banks come to mind, but I would even prefer renowned private safe deposit companies, since I agree that the risk of a bank keeping its doors shut one day is real. Does anyone know such a private company in Southern California?

[rseiser]

I am flying to Brazil tomorrow, but wanted to post a quick comment. I have now 5 years experience in shorting stocks, and there are many aspects of it with which I could fill about 20 posts. I just want to summarize for the cautious and overconfident: Try and get someone with lots (I mean LOTS, not just 5 years) of experience in shorting, and ask him about all the little details (believe me, there are hundreds). And I would like to meet with him, too. While shorting may work from time to time and seem easy, I would agree that being smart and having a theory is not enough. This is like everyone buying a house during the last 5 years telling you how smart they are, and we all know that it isn’t true and takes quite long to prove them wrong.

[rseiser]

Weekends work best for me, since I am from Irvine.

[rseiser]

PD asked about bullion versus coins. I use the following ladder: mining stocks > futures > gold depository > physical bullion > popular coins.
The more to the right, the safer, but also more expensive in transaction cost and storage. Coins are easier to exchange in a crisis, but also slightly more expensive now than bullion.
I am planning to shift my assets to the right (sell from the left) as the bull-market in gold unfolds. I am looking for the signs of speculation in small mining stocks (sort of started) or shortages on physical deliveries on futures.

[rseiser]

There are several services that do that. I guess e-gold.com comes to mind. Even an ETF like GLD is not much different, except for the extra transaction via dollars when doing a purchase or sale. I guess the government wouldn’t be too happy, since all the capital gains taxes created by inflation would dissapear. They will have to raise taxes somewhere else.
Also, even while gold is different from regular commodities, it still used to cause these cyclical fluctuations from credit creation (inflation) to bust (deflation). The establishment decided that with managing a fiat currency they could better phase out those swings. Of course they never got beyond the “credit creation” phase either, since they didn’t have the guts to reduce the money supply (except hero Paul Volcker). So with gold you would have booms/busts, and then we would have to take our medicine from time to time (or prepare better ourselves). Doesn’t sound wrong either. Also, better than a basket of commodities in my opinion, since then again it becomes arbitrary, which ones to rebalance and when.

[rseiser]

“Gold is the King of Money”, while “Oil is the King of Commodities” … is the common saying. There have been so many articles that opined on the differences, but let me just throw in a few:
-Historically there has been a clear difference in the value of gold (+precious metals) and other commodities. Take for example a strong deflation. Here, money (and especially gold) becomes worth more, while commodities crash due to drop in industrial demand.
-This is basically because gold has usually strong monetary demand (and small industrial demand) and copper, oil, lumber have strong industrial demand (and small monetary demand). The reasons are, that gold can be better stored, divided, exchanged, transported, and authenticated, and since it is expensive, the industrial use is confined to special applications. The result is further that gold trades at a strong premium to what it costs to mine, while other commodities are usually closer to their intrinsic cost (more or less).
-Gold has been universally accepted as barter for thousands of years. It has the value that it trades on a free market. This can be the futures market (say $660/oz.) or gold coins (which you can sell to the dealer for say $640/oz.). Any person on the street that has goods worth say $620, would be crazy not to accept an ounce instead, which he immediately can sell or exchange with the next person. (Legality and taxation not withstanding)
-Yes, I get the point, that shops price their goods in dollars and not in gold. But all three are still exchangeable with each other. Both, gold AND the dollar have some risk. People might charge more in ounces of gold for a while (like in 1999, or theoretically there could be a huge depository found). The same can happen to the dollar (if the government is reckless, or a huge depository is found in Uncle Ben’s backyard).
-On average, throughout history, gold was closer connected to the price of goods (say a well-made suit, for which you had to work, say, a week) than the dollar (or many other paper currencies)…That’s money for me!

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