Matt Kelly
Give me the snowboarding magazine names, ok?
posted by Not Sure if Al Gore or Global Warming is a Bigger Joke at
5:54 PM
Friday, September 15, 2006
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4 Comments:
It's not you. Its just that literally everyone thinks that this ideas is sooo crazy. But no one thinks it is that crazy to buy the GLD. I have never once heard anyone ask me how I was going to trade my GLD certificates in for real gold bullion, melt the bullion, and then put it to good use. I am just highlighting the perception that allows this to even exist. I cant believe that people think it is crazy to buy coins that are worth 1/3 of actual intrisic value, yet they think it is sane to buy bullion at face value, and get charged 1% a year to do it. That being said I have not started hoarding pennies yet, so it is really useless for me to pontificate. I am just highlighting the perception problem that possibly makes this the best idea available today.
Waddell and Reed is the largest owner of Volcom. You should hit up Doug for some info. It got hammered down to 20 but has recovered nicely. My boy Tom Gardner is all over it.
Mgmt of K2 is coiming into our office this week. Not completely pureplay on snowboarding but they make very solid gear.
Dude,
I am the original bull on the penny idea and currently have a warehouse full of pennies ($10k worth) so you don't have to justify it to me. We have spoken extensively about this issue and know what reality is about the situation.
The reason that most typical guys, who would never consider buying physical metals, do not understand this idea is that they feel they need the immediate liquidity that a GLD or structured product provides. Owning physical assets, i.e. art, coins, metals, diamonds, real estate, etc., takes time to sell. The secondary markets aren't very developed, and if they are the companies selling them are awesome companies (think Sotheby's - which is a great stock right now - CME, etc).
The house flipping game was a ludicrous concept. I mean homes have historically appreciated at 1% annually on a real basis (according to Robert Shiller of Yale) and you are telling me that buying and selling numerous times in 2/3 years doesn't represent a ponzi scheme???? The transaction and mortgage brokers were the real winners in that game.
Anyways, to get back to the subject. Your analogy to a company like MSFT or GOOG that has over 50% cash, should be recognized even though you, as a minority shareholder, do not have access to that cash.
I would like to say that I inherited a large amount of silver dollars, and, when i was young, traded a number of those coins in for anywhere from $8-$15 a piece. I think that something that was commonly used as a one unit currency that now sells at 8x to 15x is a good investment. I have no intention of ever melting pennies and think that actually would not be the advantageous play here. I mean the Fed isn't stupid; it currently prints pennies at a loss - how long will that last????? I would imagine not too long. So, we will either see steel pennies, which will drive up the value of the zinc and copper varieties or there will be no more pennies.
Finally, to add to your point about Gresham's law, which has held for all of civilization, is that people hoard $2 bills, buffalo nickels, the silver dollars made out of silver, gold, which has been money for 99% of human history. And one thing I know is that most people don't recognize great opportunities in simple places.
Hope all is well!
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