In the Wall Street Journal this afternoon there was an article about how some gun fanciers are absolutely convinced that the Obama Administration will soon be banning the sale of new semi-auto weapons and are buying up weapon stocks in anticipation of re-selling them at hefty profits when the ban goes into effect.
Is this a wise bet politically and financially?
See article
Wise bet? I think so. Only time will tell of course, but I made a bit of money last time.
It’s not all that expensive to do, since we all assume the ban will be as brainless as the last one and ban the parts that are easy to acquire. A lower ran $80 a few months ago, normal capacity magazines were $12 or so. In a couple of years I fully expect these to be worth at least 3-4x that.
And then the manufacturers or importers will figure out the loopholes and the market will be flooded again.
If none of the above happens, I have spare parts. No risk at all.
I’m chuckling to myself over the idea that this is somehow news. (I know, I know, I can’t blame the average person for not knowing about this) but most gun owners have been following this for the past six months or so. It’s old hat to us at this point. It’s a running joke in the gun community that the firearms industry is the only sector of the economy right now that’s on the upswing! (An ironic consequence of Obama’s election, and surely not what he intended when he talked about stimulating the economy.) No, 2009 truly has been the year of the gun, for those who are involved in the industry even in minor ways. The “gun panic” of the Obama election has been an interesting phenomenon to observe.
I made a few investments of my own in both rifles and ammunition, right before the election - it was a very, very wise idea. 7.63x39 ammo, in particular, is goddamn near impossible to find anymore - I was smart to have ordered a case of it before Obama won.
This is about the 4th time in my life this scare has come up. In each case, prices went up 3-4x, then when the fear of a ban receded prices fell back to about what they were before + general inflation.
A few folks who bought early in the hysteria and sold before the hysteria peaked did well. The folks who bought late & held until after reality set back in, not so much.
IMO we’re well past the point where buying makes sense as a financial transaction.
Other than the fact he’s a Democrat, there’s not much to make me think that messing with the federal gun laws has much real interest for Obama. He’s got bigger fish to fry.
But the demonize-the-left industry has got to find something to foam about, and this is a topic sure to fire up their audience. So fire they have.
Oh yeah - it’s way too late to get in on the craze. If you don’t have a safe full of lowers and Pmags by now, don’t bother.
I don’t know that I’m going to sell anything I have unless prices really go through the roof. There is so much out there that the supply will take years to dry up. 2011 is my prediction, by the way - after the midterm elections
(eta - supply in private hands I mean, the commercial supply chain is rusty but manufacturers are cranking out as much as they can as fast as they can. good luck finding anything right now)
Too bad there isn’t an ETF I could short to exploit this.
Moving thread from IMHO to Great Debates.
How would shorting me exploit this, and would it hurt much?
No, really, could you explain this to the clueless?
If prices and business sky rocket due to this fear, I would bet against it. Obama isn’t taking our guns. An ETF is a collection of stocks that can be traded.
As did I. After the 1994 ban people were buying crap that I couldn’t have otherwise given away, like Tec-9’s.
I’m wondering if the Dems learned a lesson from 1994 and hold off on gun control until after the mid-term elections.
If Obama serves 4 or 8 years without signing any major anti-Second Amendment legislation I’ll drop a duke in my underwear.
An ETF is an exchange trading fund. It’s a little bit like a mutual fund, in that it’s a fund that invests in specific groups of investments. So, there are ITFs that invest on gold companies, or food manufacturing companies, or government bonds, or whatever.
To “go short” on an investment means that you’re borrowing the investment from someone and selling it, in the hope that when you have to return the investment to the person you borrow it from, it’s price will have gone down (so you can buy it for a cheaper price than you sold it for and thereby make money).
If their premise is correct, then it will be illegal for them to re-sell the guns. IOW, they’re planning to become profit-driven criminals. Just putting it in perspective.
That is incorrect, if the assumption is that the sale of new semi-automatic weapons will be prohibited.
You mean other than the fact that a renewal of the '94 AWB was explicitly stated in his party platform? On his website?
Or the fact that his Attorney General recently proclaimed his intention to reinstate the AWB (to protect poor little Mexico, whose immaculate and virtuous police force, which is a paragon of integrity, would be able to maintain order if it weren’t for those damn American “assault rifles” that keep coming across the border.)
Bigger fish to fry? :rolleyes:
Everyone told me that gun control was a “loser issue” for the Dems and that hell would be a hockey rink before Obama ever even said a word about it. Right.
I don’t think it’s going to happen. Obama seems too smart to try to pass such ineffective legislation. Even for the ‘good’ of the party. I believe that enough people have wised up to see what BS the AWB was/is.
Obama probably will have to throw “the base” a bone on the subject (as mentioned, the current Dem platform is Very Brady), but it’s not certain that it’ll be the same thing as the ineffectual '94 law (Probably part of the fear is that this time they’ll figure something actually effective in getting guns out of circulation; that’s quite the vote of confidence in his team being smart enough to figure THAT out). OTOH he could decide to say: “Okay, you guys, so I raised some taxes; I know that hurts you more than having your kittens run over. So tell ya what: to make up for it I’ll let you keep the guns”. We’ll have to see. But this hoarding mentality really makes it a bigger, more expensive PITA for a regular guy just wanting to buy a gun or some ammo.
It’s too late to make any serious money if one is just getting around to buying stuff now.
This sort of seems like a self-fulfilling prophecy, to me. I mean, surely people buying up lots of stock is going to mean there’s less to sell and less people willing to sell (now, anyway)?
Not that it’s not the wise thing to do (if you want to make a bit of money, at least), but it seems like this is just going to make any problems worse.
No, because it means the firearms and ammo manufacturers and importers are working overtime making and importing more goodies than they ordinarily would.
Your post insinuates that the current prices are at their ceiling.
Not true.
Once a ban on new manufacture is implemented (and a few years after supplies of pre-ban items start to diminish from the market) todays prices will seem like chump change.
This will especially be true if the next ban has no sun-set clause like the last one.
I have an FFL, and while wholesale prices have gone up, they have not gone up to a level where the investment is not worth it. There is still money to be made, and there will be for quite a while.