bingobob777

tis alright, war encourages innovation.

Amazulu

It certainly does - as does adversity.

ozzieeagle

Thanks for the plain English explanation Garry P. Uptil that point I always believed that the only sure fire gain on the stock market was oil. So thats explained that away.

GarryP

There are two aspects to look at, when you look at unconventional oil :

1. The energy you have to put in to get the energy out. The more effort, heating, faffing around in general, the worse the ratio gets. Originally we got 100:1 - you stuck a shallow hole in the right bit of ground and up rushed liquid oil, under pressure. Today we are down to 10:1 or less, quite a lot less with instances when you need to frac a volume of tight oil or keep a deepwater rig working in the arctic circle. Its generally accepted that, given the other inefficiencies in the system, when you get below 3:1 it takes more energy input than you get as energy output. The tar sands aren't much off this.
2. All the faffing costs money, for the basic fuel (which of course goes up in price as the price you have to charge to break even goes up, making it worse) and for all the human capital. Given that you could drill a dry well, that makes it a bigger and bigger bet as time goes on. As it is, you are talking millions for each and every well - win, lose or draw.

Unless Antarctica was shown to have giant fields of nice sweet crude, nobody would bother. And since nobody can drill there, nobody can know. Places like South Georgia are actually better bets, which is why the UK has been using those islands to lay claim to half the South Atlantic.

Yeah, that's what I used to think, till I had a chat with someone on counterparty risk and worked out how the bigger picture practically worked. At some point it's all going to get nationalised, that's my guess. Different risk calculations if you are a government.

Oh, and available exports for importers to actually get their hands on have been falling for quite a number of years now - more hungry fish, smaller and smaller barrel....

Zen10

Thanks Garry - once again useful info The way I see the oil problem is that there are three ways forward:

1) We find an alternative to oil
2) We use a lot less oil
3) We get a much smaller global population

furbacchione

So why coins over bars. When I look at the buy to sell difference the bars have a much better difference of 14% as opposed to the coins having a 38% difference.

GarryP

I think the reason is that there are weird people out there that collect coins because they are coins. Therefore a good example can be worth than the spot price. They also look pretty.

Even so, it should be no. 1 an investment - so not too much more than the spot price.

GarryP

Don't think there will be a way forward - everything points to TSHTF.



PS Why not to invest in resources : http://au.finance.yahoo.com/news/for...ve-losses.html

furbacchione

Too early to throw it in now simply because you're not sure of it all!!! True investing takes years to get a good handle on so go with the managed funds and let the "experts" do the work. Just stick to well established reputable fund managing companies. And in the future when you truly have a good understanding of how investing works you can pull the money from the fund(s) and do your own speculating.

The coins are also a good idea in that there is something tangible that the kids can look on later. Buy a coin or two every couple months and put a memory or story to each coin... that sort of thing.

renth

'Cos it's for the kids. I'd go 10 oz bars personally.

steve_kelly_and_boys

what about the 1kg bars ?

also am i right in thinking that silver is priced in USD so any downturn in the aus $ will give you a profit

and also are these easy to offload when the time comes ? do perth mint buy them back or is there a secondary market

had a quick look on ebay and they seem to sell above perth mint prices on there

furbacchione

Years ago I learned the hard way to stay with smaller ingots - they're much easier to unload when needed. I had a number of 10oz bars of gold and when the price spiked it was hard to find a buyer that would give fair value. Everyone kept saying they would gladly buy one oz but were discounting 10 oz and above.

Zen10

Garry - wondered what you make of this. It's basically saying that peak oil theory is dead and there's no problem with oil supply at all.

http://www.guardian.co.uk/commentisf...il-we-we-wrong

And it's Monbiot!!

Beaverstate

What was the peak natural gas theory 10 years ago?

GarryP

He got the piss ripped out of him for that article, particularly since he wrote it in response to Maugeri's prediction that there was "loads'a'oil" - which got ripped to shreds for being hopelessly cornucopian (more so than even the oil industry).

Not sure if he ever admitted he'd been an idiot.

In short, he's a journalist, not someone who actually understands what he's saying