The DON'T buy gold thread

tradetime

global finances are unpredictable, the poo has yet to really hit the fan

Those two sentence fragments do not sit well together, almost an oxymoron, the "poo" as you put it "may" well have yet to hit the fan, but given the unpredictability this is far from certain, though in fairness, as a natural pessimist / realist, I'd have to say there is a strong possibility.

In reference to an earlier comment,

Thanks for a very well reasoned post!...I was expecting the standard cries of 'gold-bug' and ' numptey' from the usual suspects.

That is largely due to the fact that the "usual suspects" for the most part have been posting here for a long time, and watched the "Buy gold, buy gold, the only thing that will save you is gold, you're doomed and an idiot if you don't have gold!" brigade come and go, with more increasing regularity lately. They state opinion as fact, post reference from "experts" and dismiss all other experts as if they are the authority that would know the difference. On the subject of gold, you post similarly, that is why you attract the reaction that you do.

Gold may well be a great commodity to own as we navigate through these uncertain times, it may not, essentially owning gold here, is a bet imho, a bet that everything will spiral out of control, otherwise it is massively overpriced, and much of the money that has pushed it here is speculative and fearful, remove the fear, even temporarily or falsely, and offer an alternative speculation, and gold could fall very fast and hard.
If you are really simply trying to protect your money against inflation you need simply own index linked bonds, or if you don't trust government, any number of commodities, that people actually can't do without, and / or the producers of those.

mr_fishbulb

Thefunkygibbons wrote: »

The problem with Gold is that it does not earn an income, whereas shares pay dividends

However, it is no different than an ETF in oil, basically a punt on whether the price willl go up or down

Well it is a little bit ETF in a physical metal will usually take possession of it and store it in a safe somewhere. Oil ETFs can't do that (barrel of oil takes up a lot more space than an ounce of gold!). Oil ETFs buy futures contracts, and sell before delivery.

This article explains it a lot better than I - http://www.fool.co.uk/news/investing/investing-strategy/2009/02/17/buying-oil-read-the-label.aspx

Agree with the income part. I sold my gold and silver the other week after buying it a year ago. I only made money becuase of the weakening of the £ against the $.

cloud_dog

Hedge funds turn to gold

Gosh, well, if its in the FT then it must be true

http://www.ft.com/cms/s/37fcba70-0c0a-11de-b87d-0000779fd2ac,Authorised=false.html?_i_location=http%3A%2F%2Fwww.ft.com%2Fcms%2Fs%2F0%2F37fcba70-0c0a-11de-b87d-0000779fd2ac.html%3Fnclick_check%3D1&_i_referer=&nclick_check=1

gozomark

well thats 3 out of, what, 10s of 1000s of hedge funds :-)

Conrad

An asset without yield is not attractive to me

wombat42_2

http://www.rathergood.com/bullion

Lol_UK_2

Conrad wrote: »

An asset without yield is not attractive to me

Well an asset that loses money isn't too attractive either (pensions/ stocks/shares/ bonds etc...oh and I nearly forgot- property!). I wonder what it will take for all the gold naysayers to admit there may, just may, be some sense in owning gold?

Quote from FT..." Hedge funds had avoided gold because it does not produce yield and costs money to store and insure. But that has become less important as central banks have pushed interest rates to nearly zero, reducing the yields on currencies.'

Stavros_3

Lol_UK wrote: »

I wonder what it will take for all the gold naysayers to admit there may, just may, be some sense in owning gold?

Are you buying into it then?. Hope it goes well and you prove you were right.

sabretoothtigger

private investors arent hedge funds and I doubt many could operate hedging strategies as well

cloud_dog

Conrad wrote: »

An asset without yield is not attractive to me

As I've said before....... Making a return on my investment is for me :beer: