Buy Silver!?

I'm currently traveling Europe right now so any move I might like to make will be...not made.

The only move I see that I would be making, though, is possibly to sell gold. Or, that would have been the goal a week ago. I don't know if silver is going to continue to drop or not. I'm hoping it will, because if it does "buy silver" is a sure rule! However, now, again, it's hit or miss. If one were to sell gold and buy rhodium I would completely understand the logic!

I still have platinum that I haven't sold because I feel it's undervalued. I've feel that way for a while but the world hasn't so, as we speak, gold is higher than platinum. Hmm...

Advice? I have none I'm strongly giving except to wait. If anything, silver has fallen a higher percentage than gold, so, selling gold and buying silver would not be an unfounded decision. Personally, though, I see $22 as silver's price and gold at $1600, meaning silver could still drop more than gold (if I were the world emperor, which I'm not!).

Sooooo, in other words, I'm not doing anything with my metals/money at this point. If ANY of the five metals drops another 20% I say buy! If gold goes up 20% I say buy silver because it will follow.

Rhodium Price Drop Again

Rhodium Price Drop Again

We've been seeing quite a bit of activity in the rhodium price over the course of April. I can't tell you how timely this is for my investment strategy!

With all the other precious metals at or near their all time highs, rhodium is no where close. Granted, it may never go as high as $10,000 per ounce again, but still, I feel it's greatly under valued at the current $2200 per ounce.

What I feel will happen is that either rhodium will reach $5000 before this PGM run is over or else the other metals will come tumbling down without rhodium falling too much. I could be wrong, but my strategy is to buy rhodium. But why buy now when it keeps falling? The more it falls the more I can buy, also, the more room it has to climb!

How Metals Have Faired Over the Past 5 Years

Times have been turbulent for most of the metals. I've made personal charts with pen and paper to figure out the percentage gains of each metal versus the other metals, etc. I did this because a) I don't have a chart-making program on my computer and b) the online ones don't give me what I want to know. Let's take a quick look at some of the things that have been happening.

Gold Is Rising

To start with, gold has proven to be a great investment over the past 5 years (it's been good for longer than 5 years but I use PGMs as a medium-term investment vehicle). As you can see, if you would have sold in early 2008 for cash and rebought it late that same year, you would have increased your holdings by about 25%. From that low point of under $800 in 2008 until today, gold has nearly doubled.

Gold is too slow, steady, and boring for me. It will continue to keep up with inflation If you want to buy gold I'd wait, as it's now at its all time highest price.

Silver Rose A Lot, May Rise More, But Will Definitely Fall

Silver, like gold, has proven to be a good investment. If you did the same as gold--sell in spring 2008 and buy back in the fall--you would have increased your holdings by 100%. And, due to luck, perhaps, if you ended up buying in late 2008 and holding until today, you would have increased your holdings by 400%.

I always try to give a little advice when I can. Although no one knows what will happen, this is what I predict: silver might hit $50, but I think its run is coming to an end. Conclusion: sell your silver now!

Platinum Did Better a Few Years Ago

I don't mind bragging a bit saying that I sold some Platinum when it was at its peak back in 2008. I will however, admit that I wish I had bought it back at the end 2008. I would have realized over 100% gains!

Unlike gold and silver, though, today, platinum is still 20% below its 2008 high. I feel something has got to happen here. Gold can't remain at $1500 if platinum is only $1800. Will gold fall? Will platinum jump to $2400? Look where silver is, with it's 400% gain. It's odd silver is on such a run and platinum has held steady. It will be one of the scenarios I mentioned, but I don't know which. If I had to buy or sell I'd flip a coin because it's not high enough to realize gains or low enough to know that it'll go higher anytime soon.

Our Good Friend Palladium Shines!

I haven't been posting much but I have been sitting around watching the palladium I bought when it was $200 an ounce climb 400% to over $800! Again, yes, I'll brag, but c'mon, it was obvious palladium wasn't going to stay at $200 an ounce for long. Palladium fell further than the other metals, and kept falling after they stopped. It's risen as much as silver has, but silver did it all at once, Palladium took two years.

The advice regarding palladium I've given has always been sound. You would have always made money if you bought or sold based on my suggestions (and I'd like to keep the record going that's why I don't post too many suggestions anymore). Prediction: palladium will fall considerably, probably in 2011. If you sell palladium now, I'm guessing you'll be able to buy it cheaper within the next 6 months. I'm hoping it hits $900 or so, though, before I do sell.

Rhodium, Rhodium, Where Art Thou?

Rhodium, like platinum, had a huge 120% jump from 2006 to 2008. That was when you couldn't buy rhodium anywhere. I have my Cohen Bullion now and have investing in some pools (like stocks), but I wish we had these things back in the olden days of 2008! $10,000 an ounce wasn't significant when dealing in percentages. Looking at the chart it looks huge but now that I have my own charts I realize a few things:

• If you bought rhodium in 2006 and sold in mid-2008 you would have doubled your money
• Rhodium was the best investment from 2006 to 2008, followed very closely by platinum
• Rhodium would have by far been the worst investment today if you had bought in early/mid-2008.
  
• Over the past 5 years (if you bought in 2006 and are still holding) rhodium would have proven to be the worst investment. Silver would have been the winner, gold second, palladium third, then platinum and rhodium
  

So, that's what's happened over the past 5 years. As always, any metal would have made you a fortune if you either got lucky or timed the market correctly. What does that mean? I think it means that the worst performer, rhodium, might be looking for it's time to shine! I would never buy palladium or silver right now. I would buy gold but not at $1500, maybe after it drops I would. And I'm unsure of what platinum will do. Rhodium. I will buy rhodium. In fact, as you can see by reading my posts, I already have!

Behold! 1 oz Rhodium Bullion in my Hands!

My first attempts to own rhodium failed. First I attempted to purchase it; yet it existed no where for the layman slash everyday investor to buy. My search took me to the dark, undercover areas of Tokyo, Japan. I was given a tip in Osaka that rhodium was available in small vials in "sponge" (powder) form, but I came home empty-handed. Imagine the horror. During this 2008-09 search rhodium was at just $750 an ounce.

Next I attempted to buy bulk, looking for 4 other investors to go in with me and we each pay 20% and each get one 2 oz bar. I only found 2 other people. Finally, my search led me to Eitan Cohen, owner of the Cohen Mint. We spoke on the phone and I learned he had rhodium coins on the way! But, not only were they only one gram, I received several emails from buyers who had to wait months to have their orders filled (no, I'm not affiliated with Cohen Mint, but I assure you a) it's damn hard to make a rhodium coin and b) they WILL get it to if you're patient). Either way, I decidedI'd buy my 1 gram coins from an Australian reader of this blog. I didn't know him, but I trusted him enough to buy a few coins. The product was good, so I bought the rest of what he had.

Cohen Mint 1-Gram Rhodium Round

But I was still several grams away from one ounce! So, when finally Cohen announced the 1 ounce rhodium bullion bar I contacted the company and made arrangements to purchase one. You need a cashier's check sent overnight (to make sure there's no huge price fluctuation) or else a bank transfer. I chose the former and FedEx (man, I hate FedEx!) didn't inform me that the don't ship to P.O. Boxes. So, I didn't get my cashier's check back until the next week because FedEx sucks. Then I had to pay to ship it with the Post Office. It was a pain getting my $30 back from FedEx too! Next time I do bank transfer!

1 oz Rhodium Bullion

Email communication with Cohen Mint was good. Many readers of this site expect hourly replies. Sometimes that just isn't possible and I understand that, so I don't mind waiting a few days for a reply. After 2 months, my 1 oz Rhodium bar showed up at the local post office! I picked it up on my way to work and left it in my glove box where I thought it would be safest. Never had a break-in but the rhodium bar is worth nearly as much as the car!

Cohen 1 oz Rhodium Bullion

The coin is well-formed and smooth. There are intricate details on the coin that I wasn't expecting. I would have been happy with a slab of it stamped "Rh .999 pure" and a "Cohen Mint" somewhere on it. That's how Engelhard did their silver; and it was fine for most of us. Needless to say, it's a beautiful piece of rhodium. The bar is smaller than 1 oz of gold, which makes sense considering rhodium's density is 12.41 g·cm⁻³ and gold is 19.3 (UPDATE: I was told I'm wrong on my physics here, but I'll just keep it that way for now!) Here is the size of the one ounce rhodium bar vs. the 1 gram rhodium coin. Notice the paler color of pure rhodium vs the nickel and quarter.


When I made this purchase Cohen Mint was kind enough to inform me that they could not sell me a coin because they hadn't designed any yet, but that they had some in the works. I feel this is really respectable because if I had wanted a coin I could have waited for one (or four, actually, so that I'd have an ounce). Truthfully I kind of like the bar, but here's a preview of what the Cohen Mint has up its sleeve!

Yes, that's a man on a horse stabbing a dragon. Let's hope they can make it this awesome!