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Prax

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Some of you know me as a Penny collector (Nut), however among other things I do like to travel a bit, read ancient scriptures and regularly explore the hidden depths of my spirituality. I also follow the bullion and currency markets (though I don't indulge in any financial speculation put simply I don't gamble).

Through this forum I have come across some very switched-on blokes and I thought we should have something going about the markets. I am keen to get something going about the property market. 3 major economies (China, Canada and Australia) are on the verge of a property bubble pop, all major stock markets are bleeding and OPEC forecasts flat oil prices for the foreseeable future.

So back to my question what's your gut feeling about the UK property market and the collectibles market? Your 2p's worth please!

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Property will flatline or possibly move slightly up for the majority of the country. It won't collapse because the need for accommodation is too great. Ignore central London which is in a parallel universe and reliant on the whims of the very rich. There is sufficient money that needs laundering to keep the top end property market buoyant for years. All that QE and bribery has to find a home somewhere.

Collectibles are where they always were. The best and the rest. The top pieces always command top dollar, but the pressure is on the also rans. It has become progressivly difficult to sell lower grade items for a good price (obviously with exceptions) as the internet has opened up new sources of material to the average collector. You are no longer restricted to a handful of shops in your local area plus Spink and Seaby if you subscribed. The world has always had more material available than collectors to buy it. More people are doing background work to seek out the more desirable piecces, essentially driven by computer databases. This keeps specialist areas buoyant.

A lot of people jumped on the collectibles bandwagon when interest rates dropped to zero or thereabouts. In some cases this was not a question of making money, rather preserving it by diversification. The first real test of the market's resilience will be when interest rates creep back up again, as this will ask questions of those who diversified for reasons other than they like coins. I think the market has been moving slightly downhill for 'average' pieces for a while, but it depends on the mood on the day. A lack of fresh material will constrain prices, but a collection that has been off the market for half a century will usually do very well - think Marshall, Slaney, Boyd and a couple others.

I don't think the market is likely to collapse given the level of disposable income and the changes in society mentality. A generation ago people saved up for a house. Today, a large number of people are unwilling to do this, preferring to spend their disposable income. It doesn't require a large number of people to take up numismatics to distort the markets given we are regularly talking about the number of examples of this that and the other that are available.

With collectibles, the only important question in determining the trend is how much would it realise if I sold it today? People pay as much or as little as they feel necessary to obtain something, but I guarantee they want to sell for the most they can get, unless a forced seller.

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On 28/01/2016 at 9:50 PM, Rob said:

Property will flatline or possibly move slightly up for the majority of the country. It won't collapse because the need for accommodation is too great. Ignore central London which is in a parallel universe and reliant on the whims of the very rich. There is sufficient money that needs laundering to keep the top end property market buoyant for years. All that QE and bribery has to find a home somewhere.

Couldn't agree more.

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Funnily enough Rockerfella and Rothschild sold all their oil assets 2 years ago when the oil price was at its peak. These are the people who are influencing and dictating wars and the global economy, they both stated they wanted to invest in renewable energy.

Then we have Gadaffi, oil price is sold in US dollars, Gadaffi wanted to start selling in Dinar, why is there war in Syria, because the rich American families was to drill in the Gollan heights. Did you realise that the Bush family is the most influential family in America? Went to war twice in Iraq by both Bush Sr and Junior, now Jeb Bush is on the presidential trail, it makes you wonder which country is next and how one family can have 2 former presidents in it and a possible 3rd. The oil market is being flooded to keep the price low because some countries such as Russia rely on the revenue, if it's weak then they don't have much cash.

Now America have made a fragile truce with Iran, Iranian oil was banned from being sold on the western markets, now with the truce in place Iran is now allowed too sell it again which in turn will drop the price even more.

There is more to what we see other than a huge and sudden influx of new oil fields, this is a game that's being played out by major money players and most of them are in America.

http://youtu.be/7KsxT3woFdw

P.s, I have nothing against our American friends here, I'm just saying that something is getting played out by people who can influence Governments and markets and it seems most of them are in America

Edited by azda
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Nice vid. Golan Heights is officially Israeli territory now :)

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Property should be ok as an investment as long as you avoid areas which are obviously in decline. Demand in the UK will outstrip supply for sometime yet so as Rob says there will be no crashes. When the inevitable happens and interest rates do rise I think the increases will be small and you'll not see rates at a more usual 5% ish for some time yet.

As for oil, I've seen a few suggestions that it could dip to $10 per barrel. Bad news for Russia as their economic plans are based on achieving $50 per barrel. I think $10 is a bit low, but if it does dip significantly again, then I probably will buy oil stocks as I don't believe it can remain as low as it is for that much longer.

As for collectables, I read emails from Keith Heddle at Stanley Gibbons which are quite interesting, though I've never taken the plunge with one of their investment products. I note London Coins do something similar. Has anyone taken the plunge with them?

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1 hour ago, Mynki said:

Property should be ok as an investment as long as you avoid areas which are obviously in decline. Demand in the UK will outstrip supply for sometime yet so as Rob says there will be no crashes. When the inevitable happens and interest rates do rise I think the increases will be small and you'll not see rates at a more usual 5% ish for some time yet.

As for oil, I've seen a few suggestions that it could dip to $10 per barrel. Bad news for Russia as their economic plans are based on achieving $50 per barrel. I think $10 is a bit low, but if it does dip significantly again, then I probably will buy oil stocks as I don't believe it can remain as low as it is for that much longer.

As for collectables, I read emails from Keith Heddle at Stanley Gibbons which are quite interesting, though I've never taken the plunge with one of their investment products. I note London Coins do something similar. Has anyone taken the plunge with them?

Keep investments and hobbies separate. Coins and other illiquid collectibles are second or third tier investments, no more. As they are not immediately tradable, it is difficult to see why people would pay a premium to 'invest' in coins for profit. Anyone who thinks that SG or LC don't take their routine cut of about a third (in line with other auctioneers) is deluded. The market has to be out of control to recoup an immediate loss of a third on investment in the short term. Long term your coins can do very well. 7% or more compound over the past 50 years is a very good return, but you have always had the cost of purchase to consider, which eliminates them as a short term investment.

It would be interesting to see what would happen if half a dozen people wanted to realise significant holdings in investment coins at the same time. As the companies marketing investment packages are to all intents individual markets in toto, realising a high price for the sellers requires half a dozen plus one willing buyers to create the competitive market. I can't see it as a viable option in investment terms because the market is a closed one with the middle man making all the turns available and only offering profits as a marketing tool. Avoid.

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On 30/01/2016 at 9:32 PM, Rob said:

Keep investments and hobbies separate.

Words of wisdom.

On 30/01/2016 at 9:32 PM, Rob said:

Long term your coins can do very well. 7% or more compound over the past 50 years is a very good return, but you have always had the cost of purchase to consider, which eliminates them as a short term investment.

7% annually is a very good investment, though I have not seen coins as an investment. If I told my wife it was then she would start with how great an investment paintings are.

Edited by Prax

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Well, just piled into HSBA (HSBC ordinary shares). They looked cheap this morning at 440.35p and the dividend looks generous to me. As a result february is looking bleak on the coin front, hopefully I'll have some funds in time for the next DNW auction as there are a couple of pieces I have my eye on.

Barclays, Lloyds and even Glencore don't look unnatractive right now.

 

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Glencore is being held together with baler twine. It's mineral assets are increasingly being left underground as manufacturing industry shrinks. Copper mines in Australia and Chile are for sale, coal mines too are under threat.$2 billion of assets went for sale last year just to cover debt repayment and now they're trying to refinance $8.5 billion on a deal that's not 10 months old. If we enter a full bloodied bear market, Glencore's blood will be among the first to be shed.

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Indeed. That's all factored into the share price right now though, is it not? They've bombed to less than a third of what they were last june.

 

Perhaps we should all create a £100k virtual portfolio on here and see how we all fair?

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To be fair, as all their debt is dollar denominated, Janet Yellen did them no favours with the rate rise but I believe that huge percentages of that debt have found their way to Deutsche Bank and BNP. Both of these institutions are regarded as critically overstretched and should one, or both, hit problems it could be Goodnight Vienna for Glencore.

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So, if you had 100k to invest in now, who would you look at buying?

What do you think about UK bank shares right now?

Also, has anyone on here ever used bullionvault for gold and silver investments? I took a long look at their product the other week and it does look quite good, certainly elimintaing a lot of issues faced by small investors.

 

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Physical gold would be my bet for the next six months. When the markets resume in China after New Year it's likely that they'll resume buying gold (and desperately trying to flog whatever Beijing will allow them to sell) Last year the Chinese were taking physical possession of  on average 4 tonnes gold a month. With the Hang Seng below 3000 and likely to fall without further government  intervention I expect Chinese investors with no way of exporting funds to push demand skywards.

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Physical gold has done very well this last week or so. I regret not buying 4 x 2012 UNC and sealed sovereigns for £780 the other day when I had change!

I'm considering a small investment via bullionvault the website I mentioned, it looks very easy to use, particularly if you're familiar with the Betfair Exchange and seems safe enough too.

Glencore have had a good day today rising over 8% so far. Not convinced they're down and out just yet.

I still think bank shares are cheap. With oil prices and interest rates down they're bing hit very hard and as we approach annual announcements next week I think it will be ointeresting to hear their forecasts for the coming year, but as interest rates and oil prices won't remain this low forever I think they're worth a punt just now.

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I was thinking more of glitz bricks, 1Kg bullion. 4x 1Kg on 31st December 2015 £92,463.00

Today, £109,32.00

Raw prices without brokerage and handling. I'd personally like to have one or two 500gr. ingots in the mix, but that increases the outlay if only by 1%.

Edited by bagerap

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I know, chump change, but as it's a coin forum...  :)

What do you think about silver? Prices have plummeted in recent times but now also seem to be recovering.

 

 

 

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I b****y  well hope so! I'm holding on to a bit more than I'd like. Silver's problem is that the main users are industrial. If the public aren't buying then manufacturers aren't producing.  Warren Buffett seems to have faith, he's reportedly buying silver futures big time. BTW, he's also poured +/- $! billion into Phillips Petroleum  so far this year. Although it's the refinery side he's plunged into, not production. All that cheap oil has to be refined eventually.

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On 10/02/2016 at 4:56 PM, Mynki said:

So, if you had 100k to invest in now, who would you look at buying?

What do you think about UK bank shares right now?

Also, has anyone on here ever used bullionvault for gold and silver investments? I took a long look at their product the other week and it does look quite good, certainly elimintaing a lot of issues faced by small investors.

 

I can't do shares because I am not allowed to indulge in gambling or speculative trading. But if I had 100k to spare (and more importantly the time) I would buy 400 acres of land in Eastern Senegal and lease it to a reputed mining corporation like RAND. Eastern Senegal has a lot of untapped gold reserves and the Chinese are setting up camp there. One of my mates from Biz school is buying-up chunks of land there and setting up small mining companies. I hear you can rake-up 18% profit on your investment (every month not annually) after expenses if you are gritty. It wont be easy work for individuals - with the militia, corrupt officials, lack of infrastructure etc, so leasing is a good option but the returns will be meager. If you are not that adventurous then for 100k you can start your own scrap company. Eastern Pakistan and Western India are known as the ship's graveyard, where ships are stripped to threads. All you have to do so setup shop in Portsmouth or Plymouth, hire tow boats and make sure ships reach their graveyard. You get paid 40% over the costs to move the ships from international waters to the graveyard. If that was not enough whatever you salvage from the ship is gravy. So why do ships go to Western India and Pakistan to be broken down? International regulations, health and safety rules (especially concerning asbestos) and humanitarian and ecological concerns inhibit the setting up of salvaging yards in most countries; however 7 Countries including Pakistan, Bangladesh and India do not mind any of these things. Legal but not ethical in my opinion, but if that's what you want to do then 100k will become a million in no time.

 

Edited by Prax

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On 10/02/2016 at 3:20 PM, bagerap said:

To be fair, as all their debt is dollar denominated, Janet Yellen did them no favours with the rate rise but I believe that huge percentages of that debt have found their way to Deutsche Bank and BNP. Both of these institutions are regarded as critically overstretched and should one, or both, hit problems it could be Goodnight Vienna for Glencore.

Very good point.

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With regards Bullionvault i have been trading with them for over 5 years, very simple system backed up by Gold reserves. Just wish id sold Sept 2014. Not sure how long it will take to reach that peak again. Have purchased both Gold and Silver.

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OOps i meant wish i had sold May - Sept 2011

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Just posting UK is rich in history also one of the oldest currency reserve compare to others,UK is not paying their debt in gold.. before war or post war debt..just a comment,just wonder if UK will pay them like other countries did and what is the role of UK pound or its future to the rest of the world in globalized stock market just a comment.

 

Edited by josie
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Shanghai is getting ready to open after New Year, Hong Kong has been open for a week and showed an upward trend in the appetite for bullion.

Tomorrow U.S. and Canadian bourses will be closed. I predict a riot! Go for gold.

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I've combined my numismatic interests with bullion collecting, with the result that I have date runs of sovereigns and half sovereigns back to 1900 (London Mint only). For the most part those coins were bought for well under the present price, although a few were slightly more costly when the price was around £1000 per ounce. I see these as a hedge against financial troubles in the world and a useful bargaining tool should the worst ever happen.

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