Ruff’s Little Book of Big Fortunes in Gold & Silver: A Middle Class License to Print Money
July 27, 2010 by admin
Filed under Recommended Readings
Product Description
“Ignoring gold and silver this year will cost you more than all the dumb financial decisions you can make put together.” Ruff’s Little Book of Big Fortunes in Gold and Silver is not written for Wall Street, but for Main Street. It is a detailed guide to a once-in-a-lifetime chance for middle-class Americans to get rich investing in one of history’s greatest bull markets. Ruff makes a usually arcane subject easy to understand, and even humorous. This bull m… More >>
A good introduction to investing in Gold, Silver and mining stocks. The author is knowledgeable as well as humorous and entertaining. No shrinking violet either! It helps that I was already a huge believer and practitioner of the methods he puts forth though. An enjoyable read and well worth the money. But I will caution that , as is usually the case with these types of books , there’s a lot of cross-promotion laced throughout , from ads for his own newsletter , to other ancillory services. Some things kind of stick in my craw , such as statements like “There is no best- or worst-case scenario in which I can conceive of gold and silver being losers. You can mortgage the kids and bet the farm!”. Some claims I find questionable: “If you add up the dollar value of all the gold and silver supplies in existence, plus the market value of all the stocks of the mining companies, it would total far less than the market capitalization of Google or Microsoft.” Don’t know what is meant by this. Google has a market cap of about $123 Billion. The giant mining conglomerate BHP Billiton has a market cap close to the same , at $112 Billion. Microsoft has a $271 Billion cap. But ‘According to the World Gold Council (and others) there are between 4-5 billion
ounces of gold remaining in the world…’ (off the web). At $600/ounce that’s a value approaching $3 Trillion right there. One last thing I note with confusion is that in a the chapter on potential scams , he admits readily that a company he founded which he describes as having been a coin and bullion dealer, was subsequently sold to a scam artist, and people were hurt. He says he feels a sense of accountability , and that the buyer’s intentions were unbeknowst to him , and internet searches do seem to show that he had nothing to do with the problems that arose from this entity. But , the confusion arises from the fact that he repeatedly says he got out of the metals markets in 1980 and was even bearish until recently. “…I ignored the metals for 22 years…” So the question then is how/why he founded a coin and bullion dealership which appears to have been founded in 1985.
In any event , bullish as he is , the author offers very sound advice of avoiding undo leverage, watching out for fraudsters, and diversifying among investments within the realm of metals.
Recommended.
Rating: 4 / 5
This book is not meant for Wall Street but for Main Street is a forewarning that should not be ignored before reading this book. Ruff is not a gold bug as he claims not to have recommended gold and silver for over 22 years since making 500 to 1500 percent profits in the second half of the 1970’s in the big bull of the bullion market. This time that bull would appear to be a calf says a confident Ruff.
On the positive side the book is written in simple language with straight forward recommendations. In addition to gold and silver, other options like mining stocks, futures, bonds and interest rates are discussed in the very imminent event of a gross dilution in the value of fiat currency. In such a situation the world will fall back on real currencies, that are in themselves a store of value, long abandoned by paper currency and now by the flood of worthless cyber currency says Ruff. In addition to high inflation, other risks like that of a major terror strike, this time in cyber space, are considered as factors that can drive bullion prices through the roof, literally.
Mining company stocks have the advantage of high financial leverage on profitability during rising prices of gold and silver and have the potential to appreciate faster than the metals themselves. On the other hand one needs to be careful in choosing the right stocks since some of these companies may own mines in politically unstable countries or would have sold their future production on forward contracts.
Ruff lists some informative and helpful websites, consultants and advisors who can help individuals in building the right bullion based portfolio that can appreciate several fold in the next few years.
The most powerful recommendation is on silver. Ruff is so confident on silver that in one chapter he “begs on bended knees” to urge us to buy silver.
If one were to look for a well researched economic analysis of the global scenario, with an appetite for academics, this book will certainly disappoint. For such a reader I recommend “The Coming Collapse of the Dollar and How to Profit from It: Make a Fortune by Investing in Gold and Other Hard Assets” by James Turk, John Rubino.
This is just my review of the book and not my opinion or judgement on the accuracy of its forecasts.
Rating: 5 / 5
The book is mostly, though not at all exclusively, about silver investing. The first half of the book makes the case for owning the precious metals. While interesting, it has little to do with investing.
I did find some valuable information about silver.
I found a few problems with what Ruff says. He, and many authors on this topic, make the same mistakes. He suggests the investor use ETFs if they want to. ETFs that specialize in gold and sliver and the like, are great. But what so many people do not know and fail to report is that they are not treated like investments by the IRS. So when you sell, you pay 28% because the IRS treats gold and silver as collectibles. With cap gains, they charge the regular lower cap gains rate if you hold an asset over one year.
So when an author makes a glaring mistake like this, I question some of the other things he says. For example, he says that ALL GOLD COIN sales are reportable to the IRS unless they’re semi-numismatic. That’s not true.
While I’d want you to verify what I say, it’s my understanding that you can own gold or silver American Eagles without any reporting being done when you buy or sell (unless the amount you sell meets certain criteria.)
The California Numismatic Investments has a report on its site, which says in part:
First: You can place any size order and pay with a check. No one cares, not even the government. The only time they want to hear from us is if you invest more than $10,000 in cash. Then you must fill out I.R.S. Form 8300. There is nothing wrong with large cash transactions, but the government wants to know about them. And, by the way, you can’t spend $5000 today and $6000 tomorrow, for Uncle Sam does not like to be fooled.
Second: There are rules which apply only to bullion and only when you sell. They have nothing to do with your purchases, and do not apply to rare coins. Kilo bars are 32.15 troy ounces of gold and are subject to reporting. We are also required to report any gold bar sale totaling 32.15 ounces are more. Concerning 1 troy oz. gold coin transactions: If you sell 25 coins or more of the Krugerrand, Maple Leaf or Mexican Gold Onza we are required to report them on I.R.S. Form 1099B. Such reporting is not required on transactions involving the U.S. Gold Eagle the Australian Kangaroo or the Austrian Philharmonic. There is also no reporting on any small gold bullion coins.
Third: We are required to report $1000 face 90% silver bags and 1000 ounce silver bar transactions only when you sell to us. We are not asked to report the sale of 40% bags or less than $1000 face in 90% silver coin. The 10 and 1 ounce silver bar is exempt as long as the sale does not exceed 1000 ounces.”
Another gold company says, “Totally Private Gold, Non-Reportable – We keep all American Eagle transactions strictly private and do not report your the purchase or sales of American Eagle gold coins to the IRS or any government agency.”
I bring these issues in only to point out that the author may not be totally correct in his information and that the reader should study other material. When you start investing in gold or anything, you enter legal areas that can complicate your life. You also meet up with unsavory sorts who tell you numerous lies. I’ve run into several. So you should know the real truth and not what a few ill-informed people say.
Ruff doesn’t really go into what to buy to a large degree. But for the person just getting into gold or silver investing, I recommend this book as a good starting point.
Rating: 4 / 5
I thought the book was a good book for explaining the reasons why a person should invest in gold or silver. Ruff repeats himself several times in this short book. He probably could have reduced the book by another 30%. The book did serve a purpose for me. It left me with the desire for more knowledge about the topic. Ruff tells us where to buy the gold and silver, but doesn’t explain much about how to sell it once you are ready. No information about the tax requirements etc…
Rating: 3 / 5
Howard Ruff has hit just the right balance with “Ruff’s Little Book of Big Fortunes in Gold & Silver: A Middle Class License to Print Money.”
Many books on the subject get too wrapped up in theory. Others are too simplistic. But Ruff gets it just right. A very readable little book that explains why you should have some of your money invested in Gold and Silver, where the market is most likely to go, and why you should trust what he’s telling you.
I’ve been reading Ruff for decades, but still learned more from this little book. Whether you’re just starting out or are an experience investor, this book will help you.
Rating: 5 / 5