Investments in Gold and other precious metals

jon3001

phil_b wrote: »

Gold has performed pretty poorly recently IMO. In times like these it is supposed to rocket to the moon, that has been the mantra of almost all gold-bugs for as long as I remember. Yet here we are, in financial crises, and gold isn't really going anywere. It's day in the sun may come though, as things unfold. Who knows.

When ever it threatens to breakout, the rise seems to be countered by a crash.

C'mon - the wall of cheap money flowing into property on a high risk loans has been happening for over 5 years. You'd have to be blind not to see that with the records amounts of debt being held. Gold doubled over that period as in indicator that money was too cheap and of inflationary pressure.

phil_b wrote: »

Check out the various secure stocks on the market at the mo. Many are very low and should almost certainly go up in the medium to long term.

Cool. If you've got an asset allocation strategy you'd now be selling your appreciated assets (e.g. gold) to buy potentially undervalued assets (e.g. stocks) to reset the percentages.

1echidna

Maybe as far as gold is concerned a sea change in attitude will/is occurring. Apart from jewellery and ornaments and one or two industrial uses gold is a pretty useless metal. It was once hoarded as a currency or backing to currencies but no longer. If people have finally seen the pointlessness of hoarding it its value will tend to go down, not up.

jon3001

1echidna wrote: »

Maybe as far as gold is concerned a sea change in attitude will/is occurring. Apart from jewellery and ornaments and one or two industrial uses gold is a pretty useless metal. It was once hoarded as a currency or backing to currencies but no longer. If people have finally seen the pointlessness of hoarding it its value will tend to go down, not up.

So why is a pile of pound coins so valuable?

sabretoothtigger

It looks pretty, that is the sound financial basis for your investment :laugh:

To be fair it is also used on computer circuit boards as it conducts electricity very well. However new technology means they can lay it incredibly thin and not as much is needed as previously, but there is some base worth to it. Its not 900 dollars though, more like 90

LongTermLurker

1echidna wrote: »

Maybe as far as gold is concerned a sea change in attitude will/is occurring. Apart from jewellery and ornaments and one or two industrial uses gold is a pretty useless metal. It was once hoarded as a currency or backing to currencies but no longer. If people have finally seen the pointlessness of hoarding it its value will tend to go down, not up.

Gold is an excellent conductor and is used where the highest quality signal is required, eg in contacts for data, audio, video, photographic and a multitude of other electronic equipment.

TCA

Gold is a good investment if you believe this could happen:

http://www.moneyandmarkets.com/the-g-20s-secret-debt-solution-27996

Any opinions?

Aegis

TCA wrote: »

Gold is a good investment if you believe this could happen:

http://www.moneyandmarkets.com/the-g-20s-secret-debt-solution-27996

Any opinions?

Sounds like someone trying to ramp up the price of gold if you ask me. I very much doubt anything like that will emerge from the G20 meeting, and I think anyone claiming that up to 25% of your investment portfolio should be in gold is giving some seriously bad advice that fails to take account of risk profile or real asset allocation. All it is is a punt based on what sounds like nothing more than a strange conspiracy theory.

miserable_ol_so_n_so

jon3001 wrote: »

Certainly there are arguments for having physical possession.



............ And yes - if you don't trust a major institution like HSBC to look after your bullion in their vaults then by all means take physical possession.
........................................

If the institution holding your gold goes bust, what is the position of your holding?.......I mean will the administrators/rceivers/insolvency practioners etc give you the full current value or do you go somewhere down the list of creditors?

meester

jon3001 wrote: »

I wouldn't say gold is an investment in the traditional sense in that you're looking to make a return. Really it's a form of saving in a universal currency that has tended to keep pace with inflation over rolling 5-year periods.

It doesn't though.

In the past, gold WAS money, and prices didn't go up, because the money supply couldn't simply be increased by printing some more fivers.

Since the introduction of fiat money, holding gold been disastrous. Gold DOESN'T keep pace with the increase in the money supply, and over the long term it WON'T maintain your relative wealth.

meester

TCA wrote: »

Gold is a good investment if you believe this could happen:

http://www.moneyandmarkets.com/the-g-20s-secret-debt-solution-27996

Any opinions?

Hmm

To monetize 100% of the outstanding public and private sector debt in the U.S., the official government price of gold would have to be raised to about $53,000 per ounce.

So that means that since the gold standard ended, and with gold now at $750/ounce, the value of gold has effectively fallen 98.5%.

Gold is rubbish.