Diversification - Au/Ag Mix?

[IdahoCopper]

Let's say a person with a PMs mindset comes into a significant amount of FRNs; way, way more than their usual level of operations, for a round number let's say $2,000,000.

What ratio of Au/Ag makes sense? Also what primary expenditures make the most sense? For example a paid for house and land, a newer, reliable vehicle, a reasonable level of preps, etc.

A monster box of AGEs is around $780,000, that seems like a good starting point.

[beauanderos]

That's a great starting point, particularly if you can take advantage of this current precious metals market swoon. Plus, now you can buy that silver mine all by yourself

[Country]

Since you're talking about a big dollar amount, you have to consider the best alternatives for capital preservation. While you still need capital appreciation, I would suggest determining what portion of your assets you desire to protect and not put at high risk. I would think that lower risk portion of the asset base would have a substantial allocation to GOLD. The larger the asset value, the more you would want to protect. While a $1 million asset base could have a 1/3 GOLD (perhaps PLATINUM), 2/3 SILVER (PALLADIUM, or other rare earth metals) allocation; a $5+ million asset base might be better served at 1/2 GOLD, 1/2 SILVER. I believe it depends on one's risk tolerance; GOLD fluxuating much less than SILVER, but SILVER having the greater potential for capital appreciation. Sometimes there is comfort in not putting ones large asset base into the most volatile choices.

If you have a large asset base, be debt free, own land, and have the preps you need. Change of the rules can be foisted upon those in debt slavery.

[Treetop]

If I had that kind of cash suddenly, Id build an orchard,(I say build because Id do lots of terraforming to support the trees, and also bring in adult trees which can be expensive) and many ponds. there are methods for even the driest of areas. Probably dig out a deep and wide pit around the whole property as well, with a draw bridge and all.....

Id have several well stocked root cellars that could feed and clothe a few dozen. After that Id have a fully functioning ranch, with many live in families and my house well enough away on the same piece of land. I wouldnt do to much of the work, but Id have a full staff of folks raising animals, and fruits and nuts and grains. Id work it into a profitable venture.

After that Id go heavy into silver and gold at like 1/10 gold and the other 90 percent silver (a few tons of copper pennies to) and Id switch to 75 percent gold and 25 percent silver as the silver gold ratio goes more into silvers favor..... but thats just me.....

[Pennybug]

I'm guessing/hoping that this is hypothetical only. In reality... if someone came across 2M all of a sudden... putting it all in PM's would be foolish. A good portion (1M or so) yeah maybe (I wouldn't even do that much though in reality)... but all of it? Not smart. I'd invest in real estate with prices where they are. Buy a few fixer uppers... flip them and/or turn them into rentals. Use 50% of those profits for PM's. THAT would be a much smarter plan with 2M. Remember... buy low/sell high. Silver and gold are high and real estate is low.

However... hypothetically speaking... I'd say it depends on the age of the 2M holder. Someone my age... I'd put more of it in silver. If I were older... Gold. Silver is much higher of a risk... but over the long term... would likely have a higher payout (in say 10+ years). Gold however would be a sound investment if you were looking for less than 10 years. Just my two coppers worth.

[IdahoCopper]

These comments are all good. I'm thinking that a monster box of 500 oz of gold provides 500 months of expenses, as a secure backup. That is 41 years of living expenses.

Regardless of inflation and the FRN/Au price ratio, if your basic needs like shelter are paid for, 500 oz of gold should provide the remaining lifetime for essential living security for a 50-something person.

With the remaining $1.2M, a house & land (homesteaded to avoid property tax), a reliable vehicle, and a few modest toys, leaves around $0.5M for silver, to cover extras via Ag appreciation.

You don't need to leave anything for heirs, you just need to make sure the hoard lasts just beyond a lifetime, plus hospital and hospice expenses.

[HPMBTT]

Let's say a person with a PMs mindset comes into a significant amount of FRNs; way, way more than their usual level of operations, for a round number let's say $2,000,000.

What ratio of Au/Ag makes sense? Also what primary expenditures make the most sense? For example a paid for house and land, a newer, reliable vehicle, a reasonable level of preps, etc.

A monster box of AGEs is around $780,000, that seems like a good starting point.

Good question and I can see that others have provided some good answers. I already know what I would do: Get your basic items squared away FIRST, before investing any leftover money into commodities, precious metals etc. Not sure if you have done any kind of preparing at all, but I would do the following, (which is more/less what I'm doing now, but on a lesser scale, since I don't have 2M). This list may appear to be conservative, but given the current state of the economy and overall health of the country and the insanity of the politicians, I think it is reasonable. Here is a short list and in order of priority:

1. Stored food/water for you and spouse, kids etc (1-2 months worth of food is a minimum). For obvious reasons, this is number one on the list. Filtered stored water (min 14 days worth) is top priority, followed by stored dry food.
2. Lead/Brass (to protect your stored food/water, as well as you). This also includes a decent supply of firearms. I will elaborate on training later.
3. Pay off any/all debt (ie credit cards, car loans) as quick as you can. Basically, anything where you are paying interest in FRN's, which is throwing away money.
4. Accumulate as many hard tangible assets as you can and as quick as you can while maintaining a good amount of OPSEC. Start with:
a. Buy/get a paid-off house with land, preferably in a smaller town or in the country. Get something with a detached shed/garage/barn away from the main house. Remember that land is 'the one thing that they are not making any more of' .
b. Buy one/two reliable older vehicles (less electronics is better) and pay cash in full. No car payments.
c. Tools of all kinds. Then add stored gasoline/kerosene,chainsaw oil etc for any tools; make sure that all flammable liquids are in your detached garage/barn away from the main house and/or are underground (good OPSEC).
d. Seeds for growing a garden.
e. Start to put together a bug-out-bag for each member of the household.

and so on....I could go on for hours, but you get the basic idea.

5. Training (all forms).
a. Get as much firearms training as you can for everyone in your household (classes, Appleseed, Frontsite, Thunder Ranch etc).
b. First aid training, CPR, EMT, whatever you can handle etc.
c. read books on how to be self-sufficient
d. Home security (all shapes/forms)

and so on....

6. Investments. Many will never get to this step. But if you do all the above and still have some money left over, then start to look at hard assets, such as:
a. Physical precious metals. Remember, if you don't hold it, you don't own it.
b. Paid-in-full house in a foreign country (if you have a lot of extra money) and in a country that will allow you to legally own guns. The foreign option only works if you know that country and/or the people; also helps to have some connections etc and to know the language. If you go this route, begin to set up the offshore property in the same way as described above.

Good luck!

[shinnosuke]

beefjerky.com? Hope so and good for you. Don't forget your friends.

[highroller4321]

Let's say a person with a PMs mindset comes into a significant amount of FRNs; way, way more than their usual level of operations, for a round number let's say $2,000,000.

What ratio of Au/Ag makes sense? Also what primary expenditures make the most sense? For example a paid for house and land, a newer, reliable vehicle, a reasonable level of preps, etc.

A monster box of AGEs is around $780,000, that seems like a good starting point.

The most fun is when you open one

[highroller4321]

Since you're talking about a big dollar amount, you have to consider the best alternatives for capital preservation. While you still need capital appreciation, I would suggest determining what portion of your assets you desire to protect and not put at high risk. I would think that lower risk portion of the asset base would have a substantial allocation to GOLD. The larger the asset value, the more you would want to protect. While a $1 million asset base could have a 1/3 GOLD (perhaps PLATINUM), 2/3 SILVER (PALLADIUM, or other rare earth metals) allocation; a $5+ million asset base might be better served at 1/2 GOLD, 1/2 SILVER. I believe it depends on one's risk tolerance; GOLD fluxuating much less than SILVER, but SILVER having the greater potential for capital appreciation. Sometimes there is comfort in not putting ones large asset base into the most volatile choices.

If you have a large asset base, be debt free, own land, and have the preps you need. Change of the rules can be foisted upon those in debt slavery.

I agree mostly with what Country is saying! It all depends on your goals and what you are wanting to do. I would store at least half of it in something that preserves your purchasing power IE: gold. I would put maybe a quarter or so into something that you can be a little risky with as well as be able to have the purchasing power be preserved and have a good increase in value IE: Silver. I would put the other quarter into making sure that you have all the resources that you need. IE guns, ammo, land, water, ect ect ect.




We can all give our 2 cents worth of advice but what it really comes down to is how comfortable you are with your current situation and what you think is going to happen in the future.

[IdahoCopper]

Thanks highroller and all the others. I'm in agreement with highroller, 50% gold, 25% silver, and 25% into home/land/vehicle/debts/preps.

Now if that broker is successful in selling the beefjerky.com domain, I'll know what to do; after the IRS gets their share. So far, the deal neither done, nor dead.

[NickelExpress]

put it on black!

Seriously though..put it on red everyone knows that. If i came across 2mil, id be sitting down with a by the hour accountant, financial planner, I dont know your financial situation\goals ect.. I'm sure you do well since you already built a successful online business. If it were me, 2 mil would allow me to move income generation to a fairly low spot on my daily activities list

I would probably semi retire, buy the house I wanted (even if its a bad financial move, piece of mind is worth something) the toys I want, with required income generation being taken off the table. I would look at figuring out other ways to generate passive income even if its not a lot...Ie your website, perhaps start a vineyard, buy some businesses that turn profits year after year, and otherwise do all the things in life I always wanted to. I would spend most of my days in norway and baffin island jumping off things, but thats just me. Perhaps go back to school..in another country for shits and giggles.

[Treetop]

put it on black!

I vote "odd"

[IdahoCopper]

That's a great starting point, particularly if you can take advantage of this current precious metals market swoon. Plus, now you can buy that silver mine all by yourself

I spoke with the real estate agent today. The owner of the silver mine accepted an offer and down payment. He will also get royalties from the mine production. A large mining outfit bought it.

[IdahoCopper]

put it on black!

Seriously though..put it on red everyone knows that. If i came across 2mil, id be sitting down with a by the hour accountant, financial planner, I dont know your financial situation\goals ect.. I'm sure you do well since you already built a successful online business. If it were me, 2 mil would allow me to move income generation to a fairly low spot on my daily activities list

I would probably semi retire, buy the house I wanted (even if its a bad financial move, piece of mind is worth something) the toys I want, with required income generation being taken off the table. I would look at figuring out other ways to generate passive income even if its not a lot...Ie your website, perhaps start a vineyard, buy some businesses that turn profits year after year, and otherwise do all the things in life I always wanted to. I would spend most of my days in norway and baffin island jumping off things, but thats just me. Perhaps go back to school..in another country for shits and giggles.

NickelExpress - - You're a BASE jumper? We have a bridge here in Twin Falls where its legal to jump into the Snake River canyon. I see them parachuting off the bridge all the time.

[NickelExpress]

In Twin Falls you guys actually have a one of a kind thing in North America, due to having the coolest sheriffs department in America (If i ever make it down there ill be bringing a very large box of doughnuts). All they have to do is call the local department and let them know they are jumping, you guys even have a tugboat that will pick jumpers up out of the water. I know there's a few vagrant jumpers who split a house to jump year-round. Not a base jumper, never had the money in the bank or a job that would keep paying if i broke a femur...Hopefully in a month or so ill know if I can start on journey into going that way..if not yet..hopefully one day!