We’re all the victims of the news media, and current trends. Problem is, we respond at the wrong time to what we see. I see this most often in precious metals and guns and ammo. When do you see precious metals on the news? When they are at all time high prices. Of course the news coverage results in more interest in precious metals, and people decide to invest. New sales drive the prices higher. Once the interest wanes, the prices drop, and people sell off their holdings, resulting in prices going down even more. It’s an institutional buy high, sell low program.
With that in mind, let’s look at the gun industry. For the past decade, we have been under political pressure. There has been a constant “buy it now before it’s illegal” mindset. Once supplies thinned, prices sky rocketed. I remember seeing common 5.56 ammo selling for the astounding sum of $1000 per case. Yes, that really is $1 per round. Silly. The sad thing is that kind of price scalping brought about real sense of urgency among the buyers, and ammo still sold. So now, in the middle of 2017, we have a conservative in the White House. We have a conservative majority in the House and the Senate. The sense of urgency is gone. Inventory is stacking up at the distributors and dealers. Prices have fallen. Today, that same case of 5.56 ammo can be bought for just a bit over $300. Training 9mm ammo is just over $200 per case. And no one is buying. Silly.
Right now, at the bottom of the cycle, we need to be stocking up on ammo. We need to use this opportunity to buy that gun we want. Chances are, we won’t see prices this low again in our lifetimes. We need to train now, when the ammo is this inexpensive. We need to build enough back stock in our own homes that we can coast through the next high price episode. Let’s buy when it’s time to buy. Let’s coast when it’s time to coast. Let’s stop doing the exact opposite.