Investing In Different Guns Is Not Financial Diversification

My husband and I are 48. A couple of years ago he started buying collectible guns for our retirement and has spent over $250,000 on them so far. I totally disagree with his strategy, but would like to know what you think. Is this a good idea? — D.K., Laramie, Wyoming

Full Story – HERE

Ah the old “It’s an investment” line. Oldest one in the book and she fell for it hook, line, and sinker!  Classic.

If I learned anything from school and from Wu Tang Financial, it would be that you gotta diversify yo’ shit.

Well hopefully it works out alright for them, but like any type of investment there needs to be a buyer in order to get any money back.  With obscure guns, that may not be the easiest thing in the world to liquidate.

Hat tip: SayUncle

9 COMMENTS

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That one guy June 9, 2011 at 12:43 am

Guns are a great investment. No matter the time or era, even when money is worthless, weapons are a viable source of currency. You could trade a good shotgun for a month’s worth the supplies in a post apocalyptic world…

But as far as actual money goes, having a couple of valuable guns on hand can keep a roof over your head and food on the table when times are tough :3

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SPC Fish June 9, 2011 at 02:23 am

i agree. i had to liquidate part of my gun collection recently and even as a desperate seller i only lost money on one firearm, and that is because it was broken. Firearms never lose their value unless they are still in production and end up being mega mass produced or they stop making ammunition for it. I would put all my money in firearms if i had the chance. especially rarer firearms

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Josh June 9, 2011 at 03:41 pm

i had to liquidate part of my gun collection recently and even as a desperate seller i only lost money on one firearm

Unless you made enough money on all the others to make up for the inflation since you purchased them, then you lost money. If I purchased a firearm 10 years ago for $500 and sold it today for $600, not only did I not create any wealth (which is the function an investment), but that purchase didn’t even give me a hedge against inflation.

Doesn’t seem like a very wise investment strategy – it is kind of putting your eggs in one basket (or certainly quite a few of your eggs). Who knows what the market will be like for “collectible firearms” in the future. They’re not generating any cash flow like stock dividends or bond coupons, and they’re entirely subject to the tastes of the market – a rare Picasso painting is only worth money because someone is willing to pay an exhorbitant amount for it, not because it has any intrinsic value. And when you consider that the capital gains tax rate for collectible items is ridiculously high, it seems even less wise.

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Josh June 9, 2011 at 03:18 pm

You could trade a good shotgun for a month’s worth the supplies in a post apocalyptic world…

But in that sort of situation, who in their right mind is going to be in the market for (presumably) old, collectible firearms? In a survival situation, why would a person trade trade supplies for a collectible shotgun when a Remington 870 would more than suffice? I don’t picture people in a post-apocalyptic world being too interested in collectibles.

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cc19 June 9, 2011 at 10:47 am

Rarities and machine guns where legal. Junkers and as mentioned, those still in production, not so much. With 250k+ invested, I suspect he’s done his homework (hopefully).

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armed_partisan June 9, 2011 at 11:05 am

If he opens a gun store, he can probably turn a pretty decent profit, and likely have a pretty well stocked store, but he’ll never be able to get away with selling that many guns without getting an FFL.

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032125 June 9, 2011 at 03:40 pm

Almost any durable good is going to hold value better than fiat currency, and in the meantime he is zombie ready. The only real downside is liquidity, but even there he’s fine so long as he has enough liquidity to meet the occasional unexpected event. Guns are also relatively liquid in that buyers are generally plentiful, and will become more plentiful in WROL/barter economies.

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CuriousG June 9, 2011 at 08:58 pm

Nice ideas about bartering, zombies, post apocalyptic store-fronts and WROL TEOTWAWKI ROTFLMAO but, as the question went: “A couple of years ago he started buying collectible guns for our retirement …”

Retirement =/= zombie fighting. I agree with Josh.

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bariz barany January 26, 2012 at 02:13 pm

i like guns

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