Budgeting for the Dips

[beauanderos]

If our intent, as stackers, is to build the largest stack in the shortest amount of time or, on a longer time frame, the least expensive,
then it would behoove us to buy on dips... attempting to always lower our DCA of our ounces. That said, from what part of your budget
do you grab money when those dips appear? Or do you budget for precious metals all on their own? If a killer deal shows up, would you put
off a major purchase, or cut back on entertainment and dining out for a considerable length of time?

In view of the average budgets by decade, are you very happy with the rate you're building your stash? Content? Or concerned?

https://www.bankofamerica.com/deposits/manage/average-family-budget.go?cm_sp=EBZ-FinancialEducation-_-FinancialEducation-_-EFF1X82Z00_TargetAd_american_budget_1&adlink=tola0000000000020874

[pennypicker]

Years from now we're all going to look back and say $20 silver was a "dip; $15 was a bargain, and $13.65 (days ago) was a steal

Merry Christmas people and remember to invest not only in metals but in your physical health as well

[johnbrickner]

Squeezing the budget and the nickel 'til the buffalo shats has been a behavior since . . . the beginning. Which as I remember was when we started saving for a home. The squeezing continued to be more serious as time went on and we had children, the financial system caught fire, and subsequent bail outs, in, QEs, etc.. Entertainment and dining out are only for very special occasions. Like putting off our 20th anniversary celebration for a couple of months. Makes it like a deferred payment. Major purchases only happen when they have to happen like buying a good used car with 20k to 40K miles and running it to a 1/4 million over the span of 15 years and my mechanic says "please don't bring it back to pass it's inspection again". Personal austerity is now a way of life.

Besides, who's going to mess with a guy who is driving a 20 year old car and wears no bling, frayed t-shirts at the sleeves and pants at the cuffs, and a winter jacket looking like it's on it last days? Appearance is everything. This isn't the fat cat you're looking to fleece, move on.

Living austerity is the ultimate strategic route to decentralization of the government and corporations. Think about it, a critical mass of people don't buy, cut back to the bone on all expenses and where do corporate profits and tax revenues go? In war, you can fight the enemy tactically on the battlefield or strategically by taking away their ability to make war or build the war machine. We have been very close to that happening because of the cutting back people have had to do to survive the financial melt-down. We may get their yet if they cannot keep all the smoke and mirrors, financial juggling, or consumers' belief systems bent their direction.

Stacking or buying occurs on decent drops and relative good prices and regularly timed purchases. Not all free cash is committed as cash is king and has been for a while. Price goes up and buying stops. Price goes up high enough and some strategic selling will occur. Or perhaps you could call it rebalancing to higher value.

[Recyclersteve]

I read the choices above incorrectly. One of them said "I consider a dip in silver to be a drop of 20 to 50 cents in spot price." I thought initially it said a drop of 20-50 PERCENT (instead of cents). Now that would be quite a dip.

Don't worry- I still answered the question as I would like to answer it.

Also, it seemed to indicate that $1-2 would be a worst case scenario for the drop in the price of silver. It would have been nice if there was a choice added which indicated a drop of something like another $5 or so.

[Recyclersteve]

Accidental dupe- ok to remove this post.

[Cu Penny Hoarder]

Buying on dips is very prudent, but never go ALL in. A little bit at a time. A "little bit" is going to be relative based on your income.

There will be plenty of buying opportunities in the future.

[silverstacker]

If our intent, as stackers, is to build the largest stack in the shortest amount of time or, on a longer time frame, the least expensive,
then it would behoove us to buy on dips... attempting to always lower our DCA of our ounces. That said, from what part of your budget
do you grab money when those dips appear? Or do you budget for precious metals all on their own? If a killer deal shows up, would you put
off a major purchase, or cut back on entertainment and dining out for a considerable length of time?

In view of the average budgets by decade, are you very happy with the rate you're building your stash? Content? Or concerned?

https://www.bankofamerica.com/deposits/manage/average-family-budget.go?cm_sp=EBZ-FinancialEducation-_-FinancialEducation-_-EFF1X82Z00_TargetAd_american_budget_1&adlink=tola0000000000020874

An initial amount was established and then I have a separate "account or area" where I use that portion for PM purchases when the time is right. Never use money from the family account and maintain that as the golden rule. Moving PM's around as I sell and aquire PM's during different peaks and valleys continuously happen as I'm sure is the case for many of us.

[neilgin1]

Squeezing the budget and the nickel 'til the buffalo shats has been a behavior since . . . the beginning. Which as I remember was when we started saving for a home. The squeezing continued to be more serious as time went on and we had children, the financial system caught fire, and subsequent bail outs, in, QEs, etc.. Entertainment and dining out are only for very special occasions. Like putting off our 20th anniversary celebration for a couple of months. Makes it like a deferred payment. Major purchases only happen when they have to happen like buying a good used car with 20k to 40K miles and running it to a 1/4 million over the span of 15 years and my mechanic says "please don't bring it back to pass it's inspection again". Personal austerity is now a way of life.

Besides, who's going to mess with a guy who is driving a 20 year old car and wears no bling, frayed t-shirts at the sleeves and pants at the cuffs, and a winter jacket looking like it's on it last days? Appearance is everything. This isn't the fat cat you're looking to fleece, move on.

Living austerity is the ultimate strategic route to decentralization of the government and corporations. Think about it, a critical mass of people don't buy, cut back to the bone on all expenses and where do corporate profits and tax revenues go? In war, you can fight the enemy tactically on the battlefield or strategically by taking away their ability to make war or build the war machine. We have been very close to that happening because of the cutting back people have had to do to survive the financial melt-down. We may get their yet if they cannot keep all the smoke and mirrors, financial juggling, or consumers' belief systems bent their direction.

Stacking or buying occurs on decent drops and relative good prices and regularly timed purchases. Not all free cash is committed as cash is king and has been for a while. Price goes up and buying stops. Price goes up high enough and some strategic selling will occur. Or perhaps you could call it rebalancing to higher value.

Johnny B, that is one heck of a post, lotta wisdom in there brother. (and thank you Ray for starting this thread...its a profitable discussion)

as 2015 draws to a close, the future appears more murky and fraught with potential global and national earthquakes than ever, whether they be financial earthquakes, or geopolitical. It's almost as if a veil of confusion has dropped over the entire world.

My heart bleeds for this nation, as it appears to me, the normalcy bias, that we all grew up under is coming to an end, and therefore the concept of "living austerity" should be reflexive. Home and hearth, food and security should be our content....and when I say "security", I speak of the security of home and hearth, not this kabuki play of the "war on terror", that threaten the Liberties of these States United, the Constitution was designed to protect.

Even considering the fact that we all consider it an IMPERATIVE, the need to stack, should speak volumes as to the current situation, here and abroad.

Just some financial stat's give one cause for great concern, let me share some; the M3 money supply has gone from 2 trillion USD to 4 trillion under the current administration, and at the same time, Monetary Velocity(MV) , the rate at which currency flows thru the national economy , that chart is a disaster. (the gvt STOPPED reporting M3 in 2006, but guys like John Williams at ShadowStats dot com have extrapolated M3 from other sources....definition of M3 "A measure of money supply that includes M2 as well as large time deposits, institutional money market funds, short-term repurchase agreements and other larger liquid assets.")

here's the MV chart...and its actually from the St Louis Fed reserve:


if the chart doesn't print on this post, here's the URL....its a very gruesome chart
https://research.stlouisfed.org/fred2/series/M2V

another intensely worrisome stat is the chart of the Baltic Dry Index, which JUST hit an all time low of 471.00. As some of you might know the BDI is the shipping rate charge, and is a very good indicator of global trade. cant post the image, so here's the URL, again, another gruesome chart
http://www.bloomberg.com/quote/BDIY:IND

Now as we move into what promises to be a really embarrassing national spectacle of the 2016 election, (if we even HAVE an election, and i'll let it lay at that) consider our "choices" as of 27 Dec 2016.....Donald Trump or Hillary Clinton....just the act of writing that last line, makes me want to lay face down very still, for a very long time. If any of you, my brothers are supporters of Mr. Trump, I beg you, don't be cross with me, I just consider him the 106 degree fever on the national thermometer, showing how sick inside the DC beltway has gotten.....and Hillary? in a nation of LAW, that woman would be doing the perp walk this very moment for high crimes and misdemeanors.....and IF that was the case, we would have that socialist fossil , Bernie Sanders as democratic frontrunner. (i'm actually depressing myself as I type this)

so there's another "known unknown" looming ahead.

as to stacking, every man here KNOWS that Ag and Au are REAL money, but i'm sure you all know, that you comprise anywhere from 1 to 3% of the citizens of our nation, and in a post dollar...OR dollar implosion, it might be rough at first to actually use the stack to trade to keep home and hearth going.

here's a glimpse of how the "average" American views the value of Ag, courtesy of a true patriot, Mark Dice, its 3 minutes long, and will just blow your minds:


how about that? that's enough to drive ya mental, isn't it?

I been pondering a few years now, "what is currency?"...or what can be used as alternate currency?

on a personal level, out here in the land of milk and honey, I can look out this window, a thousand yards to the next ridge, and see 30 to 50 head of both beef and milk cattle, there's also a very heavy Amish population around here, and I am CERTAIN they know the value of Ag, I have constructed various paddocks, and this last year, I was going to start smaller scale production of poultry, 50 to 100 , however I got nailed in May, with a terrible case of pneumonia after visiting my dear mother in the nursing home....but this year, God willing, its going to happen, and my neighbor has a larger landholding just down the road, and i'm going to throw into the kick to start building a herd of Angus cattle.

not so much around here, but a lot of guys are piling into the cannabis market, and I have no desire, just coz TOO MANY folks are getting in, which just drives the price down, plus the laws vary so much, that I wouldn't want to risk the ire of my Sheriff, nor attract the attention of some of the two legged 20 something male human rodents, that would be stupid enough to go poking around this ridge, once they got wind of any whacky tabaccky "garden".......not worth it.

However, I watched a video about Popcorn Sutton, a simple man, who used to brew up corn likker. It intrigued me, because I don't drink hardly at all, I got tons of corn around these parts, more than ample clean drinking water, (you haven't tasted water so sweet like I got out my well, that dives down to 460 feet) got plenty of unopened Mason jars, and a bunch of rock, that is really 2 and a half million year old coral reef......which is really something to me, that my place sits atop such an ancient reef........and those rocks are sturdier than you'd ever believe.....okay back to the point, corn likker is something that you can brew, bottle up "untempered" (meaning 190 proof) and stow those jars in my basement bunker, and they will KEEP. what i'm going to do next is look for both 5 foot by 30 inches sheets of copper for the pot and copper tubing for the "worm"......which is that circular copper tubing, that is put into a oak barrel, that's got to have cold water running thru it........if anybody here, knows a good source of copper sheetings, just PM if you could be so kind.

it's 90 minutes long, but this is sure a VERY entertaining film. movie, documentary of Popcorn Sutton's "last dam run of likker".....even though he's east in the Appalachian hills, it looks very much like that up here, except we're northern Yankees, and lucky for me, I got a couple of young men, good fellows, that can bend and weld, AND keep zip lock mouths.....but anyway, if you don't have anything to do, you wont be bored watching Popcorn in this film.....that likker is currency....might not be Ag or Au, but it'll trade. I know i'll make some mistakes in the beginning, but check this, a quart of FINE untempered corn likker trades for $200 a quart....enjoy the film and Happy New Year

[johnbrickner]

Grateful for your posts Neil. Regarding the BDI, this is the third time this year it's hit a new historically lows in Feb, Nov and this month Dec. Yea, lower than in late '08/early ''09. Now some claim it's the extra ships that were ordered and subsequently built in the run up to the '08-'09 crash and ordered and built ships to answer the increased demand for coal to china in 2012/2013 that is the reason for the high supply answer to the low numbers (takes 2-3 years to build). Maybe it's just me, but who in the shipping business after '08/'09 would be stupid enough to expand so much on the idea China would continue it's increasing demand for coal? OK, just answered my own question. The Maersk Line would make 10 (between 2013 - '15) of the worlds largest vessels of any kind on the ocean to hold 18000 TEUs (containers) called The Triple-E Maersk. Daewoo to build at a cost of $190 million each. Maersk stock hit a high of >16000 this year and is now around 9000. A 45% loss give or take. Ok, so you have that kind of money to throw around so you can put little guys out of business? Stock price says the strategy is not good.

Regarding the wacky tobacky, I think the safe money is to be the lab that verifies the content and the quality, especially important in this new "legal" environment. If you can establish a provider supplies medical quality verified, you should get most of the business. Especially since so many are trying to get into the market there are a ton of customers and all you are doing is the testing. No growing, no packaging, no distribution, no cash only business, no stoned customers, no high security needed, just the "on the level, above board, transparent, not meth lab".

Regarding the corn likker, 'still it 'til it's good. If it takes some batches to get there adjust the floats on the carb, replace the jets, and mill the head for a little extra compression and you got some rocket fuel.

[68Camaro]

What would the adjusted BDI be with the shipping oversupply taken out?

[johnbrickner]

I don't know what the adjusted BDI would be but I read the oversupply is 15%. Can you factor that into an adjusted BDI?

[InfleXion]

Lots of great posting here, not sure I have time or mental faculty at this hour for a lengthy diatribte, but...

If our intent, as stackers, is to build the largest stack in the shortest amount of time or, on a longer time frame, the least expensive,
then it would behoove us to buy on dips... attempting to always lower our DCA of our ounces. That said, from what part of your budget
do you grab money when those dips appear? Or do you budget for precious metals all on their own? If a killer deal shows up, would you put
off a major purchase, or cut back on entertainment and dining out for a considerable length of time?

In view of the average budgets by decade, are you very happy with the rate you're building your stash? Content? Or concerned?

I'm not too concerned about my DCA. Sure it's nice to be able to lower it and stack more, but my main intent is to acquire tangible assets that can't be stolen by someone with a computer, and I feel confident that precious metals are undervalued enough that any amount I can afford to spare is good enough. I don't really budget from the standpoint of ABC dollars is allocated for XYZ purpose. I try to save as much as possible all the time, and whenever I have some leftover I allow myself to spend some of it. I suppose if I really have to tighten the belt I do better about planning my meals, looking for coupons and deals, try not to drive as much or go out. I don't put off major purchases for metals, only for other major purchases. Metal always sneaks in anyway somehow. I don't have many back up the truck moments, just my initial plunges to establish my core position.

Besides, who's going to mess with a guy who is driving a 20 year old car and wears no bling, frayed t-shirts at the sleeves and pants at the cuffs, and a winter jacket looking like it's on it last days? Appearance is everything. This isn't the fat cat you're looking to fleece, move on.

I couldn't have said it better! When people point out that my car paint is peeling, I tell them I like it that way. It ain't much to look at but it's a blast to drive. I don't want people casing me thinking I'm a baller (even though plenty of people putting off that image are in debt to do so). I only keep my frayed shirts because they work fine for the weekends and if nothing else I can use them for kindling.

as to stacking, every man here KNOWS that Ag and Au are REAL money, but i'm sure you all know, that you comprise anywhere from 1 to 3% of the citizens of our nation, and in a post dollar...OR dollar implosion, it might be rough at first to actually use the stack to trade to keep home and hearth going.

When I think about what it takes for home and hearth, it's really just people putting in the work. Metals being a labor cost are a good way to exchange goods and services, but without those goods and services they don't mean anything. I figure if the dollar goes away I'll be living elsewhere with some family and we'll go back to the old ways, which many of them are familiar with as well as metals. I wouldn't be looking to build trading partnerships with outsiders at that point if it could be helped.