investing in gold?

planteria

discussed on R4 this morning..

http://www.bbc.co.uk/news/business-27030705

pat_cashmoney

"China's demand for gold is set to rise by about 20% over the next few years, the World Gold Council has estimated"

Of course, the World Gold Council's opinion on gold popularity is certainly not going to be biased in favour.

planteria

fair point...but is it wrong?

canucrackit

I invest a portion of my money in precious metals. I recommend you watch Mike Maloney on youtube, people like Doug Casey, Jim Rickards. Read books on it and you will know why millionaires and billionaires have tangible assets outside of the financial system. It's not 'investing' really, its a safe haven asset that has been used as money for thousands for years. Every paper 'fiat' currency has always gone to zero. Gold has and probably will always be worth something, in times of crashes gold and silver go up exponentially.

Once upon a time england and the rest of the world had a gold standard, so did america. When people stopped exchanging paper notes for gold they basically stopped and only hoard gold at central banks. So paper 'fiat' money or money on a computer screen are now un-backed by anything (just your trust that they are worth something).

Most financial advisors (those for the rich) advise at least 5-10% in precious metals, including gold.

You can hold gold yourself, have it stored in secure vaults offshore (to avoid confiscation by governments such as the U.S in the past). People also hold gold stocks and ETF shares (these aren't gold and only give exposure to gold).

canucrackit

cathybird wrote: »

Would a physically backed ETF covering several precious metals including gold be a better bet? ... As a small part of a wider portfolio, of course?

I mention this because I had been thinking of this myself, though have only just started building the investments up and am not going to rush into it. It would be more diversified than just buying gold.

ETF's don't have enough gold for what shares they offer. If everyone claimed they would run out, banks like JPM have been known to rig ETF markets. If you don't hold it then you don't own it. It actually says in small print of ETF's that they offer 'similar exposure to gold', thats not gold. People rarely take delivery on gold in ETF's and just sell options.

Pitchshifter

canucrackit wrote: »

I invest a portion of my money in precious metals. I recommend you watch Mike Maloney on youtube, people like Doug Casey, Jim Rickards. Read books on it and you will know why millionaires and billionaires have tangible assets outside of the financial system. It's not 'investing' really, its a safe haven asset that has been used as money for thousands for years. Every paper 'fiat' currency has always gone to zero. Gold has and probably will always be worth something, in times of crashes gold and silver go up exponentially.

Once upon a time england and the rest of the world had a gold standard, so did america. When people stopped exchanging paper notes for gold they basically stopped and only hoard gold at central banks. So paper 'fiat' money or money on a computer screen are now un-backed by anything (just your trust that they are worth something).

Most financial advisors (those for the rich) advise at least 5-10% in precious metals, including gold.

You can hold gold yourself, have it stored in secure vaults offshore (to avoid confiscation by governments such as the U.S in the past). People also hold gold stocks and ETF shares (these aren't gold and only give exposure to gold).

Well said, this is exactly what I've been thinking and have started buying physical silver coins (gold is a bit pricey for me), instead of saving all my spare cash in the bank.

grey_gym_sock

canucrackit wrote: »

Most financial advisors (those for the rich) advise at least 5-10% in precious metals, including gold.

at least 5-10%? i'd be very surprised. at most 5% is more like it.

Pitchshifter wrote: »

Well said, this is exactly what I've been thinking and have started buying physical silver coins (gold is a bit pricey for me), instead of saving all my spare cash in the bank.

cash is not much of investment - it's mainly for short-term money. but is silver the only investment you have? if so, that's very bad investing. it should be more like 5% maximum. most investments should be in things that actually make money (e.g. shares, corporate bonds), not just sit there, being shiny.

PsychoBob

I invest a portion of my money in precious metals. I recommend you watch Mike Maloney on youtube, people like Doug Casey, Jim Rickards. Read books on it and you will know why millionaires and billionaires have tangible assets outside of the financial system. It's not 'investing' really, its a safe haven asset that has been used as money for thousands for years. Every paper 'fiat' currency has always gone to zero. Gold has and probably will always be worth something, in times of crashes gold and silver go up exponentially.

Once upon a time england and the rest of the world had a gold standard, so did america. When people stopped exchanging paper notes for gold they basically stopped and only hoard gold at central banks. So paper 'fiat' money or money on a computer screen are now un-backed by anything (just your trust that they are worth something).

Most financial advisors (those for the rich) advise at least 5-10% in precious metals, including gold.

You can hold gold yourself, have it stored in secure vaults offshore (to avoid confiscation by governments such as the U.S in the past). People also hold gold stocks and ETF shares (these aren't gold and only give exposure to gold).

I agree with almost everything. I love Gold. However, fiat money is backed by the power of Government. They have land, gold, tax raising powers & the military, which is quite powerful.

grey_gym_sock

you talk as if cash and gold (or silver) are the only options. they're actually the worst options for long-term investment.

falling in love with an investment is always a bad idea!

PsychoBob

falling in love with an investment is always a bad idea!

you're correct. Gold should be part of a diversified portfolio. I still love having it though.