OT: Does anyone here hold bullion?

[MattTuck]

I was talking with my parents over the weekend, and we were discussing the run up in gold prices. I hold a small part of my IRA in the Gold ETF (symbol: GLD) for some exposure, but we were debating the merits of holding physical gold. (Such as Krugerrands, or Gold Maples, etc. or even other precious metals such as Palladium or platinum).

Curious if anyone here holds something similar, how do you manage it? Keep it in the house? in a safety deposit box? Hold 1 oz. coins or smaller denominations? Have them stored in a gold vault? etc.

Obviously, there is debate on whether gold is a good investment, and I've heard both sides, so I'm not looking to get into a debate about that. Hoping though, that I can get some specifics on how you acquired it, how you keep it safe, any other tips.

Thanks.

[54ny77]

Yes in the kitchen. So far, the zombie's or the gubmint haven't come knockin' for it. Yet.

:D


https://encrypted-tbn2.gstatic.com/images?q=tbn:ANd9GcS_UofulnVkUex8VdkJxe4UdkjnC7Gne gZ8g0rdCmeWpqXMiP10

[zap]

Sail boat.

[Andrewlcox]

I am curious as well. I have been considering buying 1 troy ounce of silver per pay or per week to have another form of savings for my daughter's college. If I bought weekly and prices stay flat I will have over $30,000 in silver.

[Nooch]

How would you even go about purchasing gold/silver/etc...

[nighthawk]

How would you even go about purchasing gold/silver/etc...

In Florida they have vending machines that you can purchase it from, seriously.

http://www.blogcdn.com/www.luxist.com/media/2010/12/goldatm.3ea5d1fb732b4333906a4a731aba7173.jpg

[MadRocketSci]

http://www.goldmoney.com

not affiliated in any way....

[MattTuck]

http://www.apmex.com/ for one, but there are many others including Northwest Territory Mint, or you can just go to a local bullion dealer. There's plenty of them out there.


I would not invest in silver. This visual is a short and sweet summary of why. (http://www.visualcapitalist.com/the-silver-series-investment-part-3)

[jlyon]

No but my financial advisor recommends between 2 and 5% of your investments should be in such.

He said you should hope that it is the worst investment you ever make because if it becomes on of the best it means everything else in the world is not going well.

It is an asset of last resort if all other currencies become worthless.

Having said that he also believes it is very over valued based on how much it costs to produce an once of gold but the world wide demand is so strong it is holding up the price.

But if you want to be diversified you need it and it needs to be assessable if everything hits the fan.

[jr59]

I do.

Seeing as I run some pawn shops in New Orleans, I sure do.

I don't hold gold, as I have to much money tied up in buying it.
It goes to the refiner quickly.

Silver on the other hand, I have held for going on 6 years.
With the cost of silver, I can afford to hoard it.
I sell a little of the flatware and tea servings and a small
amount of jewelry. But mostly I hold it.

I have a local refiner that will smelt silver for me. So most of the
junk stuff I smelt into bars or trade my guy for .999 bars. Most of the jewelry
is .925 and more and more less than that. Even though it's halmarked @.925.

I don't sell .999 silver we get, or any coinage.

I have 4 t-ratted safes, and 3 rather large safety dep boxes for the silver.

Please buyer beware when buying bullion. Just because it's marked as something, doesn't make it so!

[Ralph]

Some years ago, bought 10 Canadian Maple Leafs. Noticed there was a big spread between bid and ask. (what you pay and what it sells for). They wanted a storage fee to holt it, so had it shipped out to me. There was a shipping fee. Keep it in my safe deposit box, and when I got rid of that, kept them around my house. Occasionally taking them out to look at them.

Not too long ago, decided to sell them. Called the company I bought them from. They said to ship them to them (shipping charge), and they would assay them (probably a charge) to make sure they are what they look to be. So I said screw that.

Took them to a local coin dealer who has a good reputation. I knew the selling price bid and ask, in the market before I went. He offered me that bid price, minus 10%, because he said I had scratched them playing around with them, and they were no longer new. They did come with paper between them, and I didn't always keep them apart. Never thought about that actually.

Thought about it a while, gold went up some more, and I sold them to him. Still made a big profit. Learned a bunch also.

My advice.....stick to your ETF if you feel you need a gold investment (and I don't at current prices). Mining companies are leveraged to the price of gold, both ways. If you buy coins or bullion, do not take delivery. Let them hold it for you, pay a storage fee if there is one, and avoid all the shipping, etc.

[1centaur]

It is an asset of last resort if all other currencies become worthless.

If currencies are worthless, trading metal for food will be dangerous and unlikely to work long for folks. To some extent the arguments for and against holding gold play through to holding the metal itself. Those who advocate holding physical seem to think governments will stop ETFs from paying off. If that were true, holding physical would again be only a tiny stop gap before it was useless, unless you had an army to defend you.

It seems to me the argument for gold is that currencies will devalue SOME and gold will hold relative value, and if that argument works then holding physical is a wasted gesture since presumably you can't store it and transport it as cheaply and safely as an institution. Fun to hold and look at, maybe, but as a pure investment choice I'd pick an ETF that holds physical to remove the potential for derivatives markets to go haywire and separate you from your claim, though again, if we reach that point we may have enough other problems that the gold thing will be a minor problem.

I look forward to hearing why some would like to hold physical other than something that sounds like survivalist thinking/paranoia about government actions or just the desire to touch something tangible.

[MattTuck]

I think the biggest 'knock' on the Gold ETFs is that people claim they may only hold a small part of their AUM as physical gold, and hold the rest as either leased gold, or futures on gold.

The argument, dubious as it may be, is that gold has been rehypothecated and leased throughout the banking system, and no one knows who truly owns the gold.

Holding physical gold yourself is a hedge against overly leveraged/overly sophisticated financial institutions (central banks included) becoming insolvent and illiquid as the assets that back up their loans evaporate.

[maxdog]

If currencies are worthless, trading metal for food will be dangerous and unlikely to work long for folks. To some extent the arguments for and against holding gold play through to holding the metal itself. Those who advocate holding physical seem to think governments will stop ETFs from paying off. If that were true, holding physical would again be only a tiny stop gap before it was useless, unless you had an army to defend you.

It seems to me the argument for gold is that currencies will devalue SOME and gold will hold relative value, and if that argument works then holding physical is a wasted gesture since presumably you can't store it and transport it as cheaply and safely as an institution. Fun to hold and look at, maybe, but as a pure investment choice I'd pick an ETF that holds physical to remove the potential for derivatives markets to go haywire and separate you from your claim, though again, if we reach that point we may have enough other problems that the gold thing will be a minor problem.

I look forward to hearing why some would like to hold physical other than something that sounds like survivalist thinking/paranoia about government actions or just the desire to touch something tangible.

Your understanding of the problem with PM ETFs is inaccurate.

[cnighbor1]

I get the publication Bull and Bear which reports on Mining stocks plus gold , silver etc articles. plus they have reports from all stock letters
which I suggest getting joining to get their publications.
Anyways they had and article on best way to invest in gold. seems their is no good safe way to invest
If into mining stocks they tend to follow the market. if into holding physical gold the storage costs are high if holding any large amount. and EFT's are dicely has they are required to hold gold bullion but a lot of thier holdings are paper that states it is worth so much in gold. which in a run on gold could be worth very little. so gold not a safe investment per above
A cyclist freind you played Day trader a few years back took his profits and put into gold coins which he put into a safe depoit vault Now worth over $6,000,000.00

http://www.thebullandbear.com/

"By Peter Schiff, CEO
Euro Pacific Precious Metals

For such a wonderful year for precious metals investors, the final calendar quarter left little to celebrate. Just as people now take for granted that their phones will also take pictures, play music, and surf the Internet, many investors have come to expect gold and silver to move up in a straight line.
In fact, in a recent CNBC interview one analyst claimed that gold’s recent correction proves that it is not really a safe haven. In truth, such a statement merely proves how little some analysts know about markets.
However much the fundamentals may be on your side, there are always mitigating factors that affect price movement. In the case of gold and silver, the temporary resurgence of the dollar versus other fiat currencies alternatives has been the dominant factor – but even that isn’t the whole story.

Stampede Out of Euros

The critical factor that has been in play the past few months has been the European debt crisis going critical. I have said all along that the US is in worse shape than the EU overall because the EU has less will and capacity to resolve – or even temporarily paper over – its problems. The flip side is that, absent the massive stimulus the US has received, Europe has been forced to deal with its sovereign debt problems first.
Global investors have been spooked since the credit crunch of 2008. That means they are more likely to follow the herd rather than stick to the fundamentals. It takes a certain firmness of character to watch your investments sell off by double digits and not have a moment of self-doubt.
So, what we’re seeing is big moves into and out of asset classes. But what is important to understand about these circumstances is not the scale of the moves but the direction of the trend.
Right now, the dollar is riding high. But it’s still down over 30% over the last decade as measured by the generous US Dollar Index. Gold, by contrast, is up over 350% in that period. Of course, past performance does not guarantee future results, but the fundamentals have not changed. It’s worth remembering that mainstream analysts chose the dollar over gold in almost every report over the last 10 years, based on a blind faith in the power of the US government to centrally plan the American economy. The market proved them wrong.
Once again, the mainstream narrative is that the real danger is in Europe and therefore the US offers a safe haven. This has caused a stampede out of euros and into dollars. But as we’ve seen over the last few years, the euro and dollar can decline simultaneously – and will continue to do so as more and more investors realize that the real safe haven is gold.

Shooting Straight Up

There is a reason assets don’t move up in a straight line. Besides varying liquidity needs and risk appetites of investors, there are also built-in mechanisms to flush speculators out of a skyrocketing market.
As silver approached $50 this past April, the COMEX raised margin requirements for futures contracts on the metal, thereby pushing many speculators out of the market. While this practice presumably prevents speculators from overusing leverage, it also has the effect of crushing the short-term price of the metal. Both gold and silver have been subject to increased margin requirements this past year.
While we can now rest assured that future price increases are driven more by long-term investment than short-term speculation, it is not without costs. Speculators serve to reduce volatility in a market by buying in anticipation of future scarcity and vice versa. So, pushing out the speculators may increase volatility in the future. However, it’s my feeling that in truth no gains have been lost at all – they have merely been postponed.

Is This The Top?

In order to determine whether the recent sideways movement of gold and silver is cause for concern, let’s look at what lies ahead for 2012.
It is clear from 2011 that the new Tea Party members of Congress are not strong enough to stop the fiscal bleeding, and with the Occupy Wall Street movement in full swing, President Obama doesn’t have a lot of room to compromise. Washington has been reduced to short-term measures to “pay” its bills, and the bills are mounting faster than ever.
Meanwhile, Ben Bernanke’s Federal Reserve seems intent on pushing all the boundaries of monetary policy. In its most recent ploy, the Fed has engaged in a covert bailout of Europe through the use of currency swaps. From an investment perspective, this goes to show how deluded dollar investors are – they’re buying into a currency that is being printed for any and all comers. This news should have caused the dollar to tank and gold and the euro to rise, but again, the fear trade is overriding all other considerations.
2012 should see more trouble from Europe, and therefore potentially more dollar buying. This might even be the year we see a few members exit the euro. However, there is no way to know how the euro will react in the short-term to such events, as such scenarios may already be priced into the market. In any event, long-term, the eurozone will be stronger without its weaker members. If they cannot mend their profligate ways, better to force them out now than compromise the solvency of the stronger members.
For smart investors, dollar strength caused by euro fears is simply an opportunity to buy contra-dollar assets on the cheap. Yes, I believe sub-$30 silver and sub-$1600 gold are still cheap for what’s ahead. And with 2012 forecasts of $2,200 by Morgan Stanley, $2,050 by UBS, and $2,000 by Barclays, it appears I’m not alone.
Editor’s Note: Peter Schiff is CEO of Euro Pacific Precious Metals, a gold and silver dealer selling reputable, well-known bullion coins and bars at competitive prices. To learn more, please visit www.europacmetals.com or call (888) GOLD-160.
For the latest gold market news and analysis, sign up for Peter Schiff's Gold Report, a monthly newsletter featuring original contributions from Peter Schiff, Casey Research, and other leading experts in the gold market at www.europacmetals.com.
''

[Louis]

http://3.bp.blogspot.com/-e5U5m5N2vsg/UGZDe-DEPeI/AAAAAAAABDA/MyphocnXsws/s1600/the_road.jpg

[cnighbor1]

Morgan Stanley: Gold, Silver Among Top
Commodity Picks For 2013: Cautious On Base Metals

Allen Sykora: “Morgan Stanley lists gold and silver, along with corn and soybeans, as its most preferred commodities for 2013.
The firm also offered upbeat remarks about platinum group metals but described itself as “relatively cautious” about base metals, listing copper as its lone pick in this category.
Morgan Stanley looks for gold to average $1,853 an ounce next year and for silver to average $35. The platinum forecast is $1,715.
“We prefer commodities with structural stories or those facing supply constraints,” the firm said in a 2013 commodities outlook released overnight. “Higher prices in recent years have brought both a supply and demand response, bringing many to call for the end of the commodity ‘super cycle.’ We view this as too simplistic.”
Commodities are cyclical, but the elasticity of supply and demand, as well as the length of the cycle, varies significantly across the complex, the firm said.
“Investors must be more selective, but opportunities abound. With global demand uncertain, supply-side fundamentals, demand elasticity and idiosyncratic risks will prove increasingly important in driving price action. Under this lens, we favor exposure to gold/silver and corn/soybeans. We are modestly constructive crude oil into 2013, but more so in the 2H.”
Morgan Stanley said gold is its “preferred fundamental metal exposure heading into 2013.” The third round of quantitative easing in the U.S. and European Central Bank’s unlimited bond-purchase program are the most important factors for a continuing weak trend in the U.S. dollar, and in turn a key for stronger gold prices in the short term, Morgan Stanley said.
“However, low nominal and negative real interest rates, ongoing geopolitical risk in the Middle East and continued mine supply issues are also supportive,” the firm said. Morgan Stanley said it looks for continued support from central-bank buying and for a recovery in Indian demand as the country becomes more accustomed to higher prices.
Morgan Stanley said silver is a “cheap proxy to gold” and said it looks for the metal to outperform gold in 2013.
Supply-side constraints provide potential support for platinum group metals, Morgan Stanley said, adding that it views supply/demand fundamentals as better for palladium than platinum.
“We have a more optimistic outlook for platinum group metals, as supply issues in South Africa have helped eliminate surpluses in all major PGM markets,” analysts said in their report. “We expect deficit markets to continue in 2013, with upside benefits for prices. Industrial demand remains firm, and supply is constrained by South African labor issues, reduced sales from Russian stocks and lower recycling rates.”
Meanwhile, Morgan Stanley analysts described themselves as “relatively cautious” on base metals due to a “guarded view” of first-half global economic growth and the complex’s strong correlation to global macroeconomic trends.
“The downside risks to pricing are only magnified by a structural oversupply evident in most base metals markets, with the key exception of copper and perhaps lead,” Morgan Stanley said. “Upside for next year may be found in 2H13 as our global economists are forecasting a pick-up in industrial activity.”
Morgan Stanley said copper is “our sole pick in this complex,” forecasting an average price of $8,600 a metric ton. While supply is expected to grow, global inventories are starting from a low base. “We are becoming increasingly positive on the outlook for copper’s key end-use sectors in 2013, especially in China,” Morgan Stanley said.
The firm said the aluminum market is “oversupplied and over-produced,” pegging its forecast at $2,300 a ton. Other base-metals forecasts include nickel, $18,300, and zinc, $2,200.”
Editor’s Note: To keep up with metals news and features, follow Allen Sykora on Twitter @allensykora

[Tony T]

[The Road] Interesting. In the book, when he discovered the bunker, he didn't take the gold coins.

[nighthawk]

[The Road] Interesting. In the book, when he discovered the bunker, he didn't take the gold coins.

Because they are rough on the digestive tract. ;)

[Louis]

Personally, I think that if anyone here really knew what was going to happen to various commodities in the future (not an easy thing to do) they wouldn't be sharing that info with the rest of us schmucks.

[the bottle ride]

With all the monies that have flowed into gold in the last few years- especially in the gold etf which is suppossedly backed by the actual asset- it makes me wonder if there is actually that much gold in the world. Or the number of countries who have become net buyers for the first time in decades for gold. Is there that much physicial gold in the world? I dont think there is.

There have been a few stories floating around about soveriegn banks taking the physicial only to find they are tungsten plated with gold.

It makes me think of all the people who buy fancy French wines thinking they are getting petrus etc...they dont make that much wine in France to appease the US market since the Russians and Chinese buy it all.

I would not touch it.

[verticaldoug]

Matt,

GLD holds the gold in London Vaults. They do not lend, lease or trade the physical. Currently they hold 42million+ ounces. The running cost for the trust is approximately 40 bps per year. They can have some gold at subcustodian from time to time prior to transporting the gold to the vault. Unless the world goes totally FUBAR, it's probably as advertised. Read the prospectus.

In the event that you actually want the physical gold use to barter, we probably have much larger societal issues.(like no society) For this scenario, I have two gold crowns on my back molars. I figure I can pull these out to pay Charon,because that is were most of us are headed in the later scenario.

[Ahneida Ride]

The current Central Bank / fractional reserve financial system is the greatest form of slavery ever devised by mankind.

[MattTuck]

Personally, I think that if anyone here really knew what was going to happen to various commodities in the future (not an easy thing to do) they wouldn't be sharing that info with the rest of us schmucks.

I'm usually a proponent of efficient markets and index investing. However, with the things I can see today including fiscal deficits, monetized debt and a federal reserve that seems intent on creating asset bubbles to stimulate the wealth effect, it doesn't look good for the green back. That is not say I couldn't be wrong, and not to suggest that one should put all their [golden] eggs in one basket, but if I'm going to advise my parents to hold a little physical gold, I'd like to make sure they're doing it right.

[Louis]

The Germans are about to repatriate a bunch of their gold (billions) that had been put away in London, Paris and NYC for safekeeping in case the USSR tanks came rolling through the Fulda gap. Now that that threat has receded the NYC and Paris gold will be going to Frankfurt, and the London gold staying put. Maybe during the transfer a few bars will "fall off" the proverbial truck...

[zap]

If currencies are worthless, trading metal for food will be dangerous and unlikely to work long for folks. To some extent the arguments for and against holding gold play through to holding the metal itself. Those who advocate holding physical seem to think governments will stop ETFs from paying off. If that were true, holding physical would again be only a tiny stop gap before it was useless, unless you had an army to defend you.



My grandparents lived through hyper inflation (Germany) and would have been better served with gold vs paper money. I have roughly 100,000,000,000 Deutsches Reich Marks (of course face value) in my stamp collection. Funny, mail in the early 30's from USA to Germany was US1 cent.

One day you can afford a loaf of bread, wake up the next day and not.

Anyhow, man with gold will be able to afford a few good men with rifles (oh boy). Soup and some bread twice a day and a bed under roof will get you one hell of a lot of loyalty.

Wolf Among Wolves by Hans Fallada is an interesting read.

Property and gold.

[cfox]

Once every other add on the radio or cable tv is for "xy gold advisors" and such, that's pretty much the time to sell. There is an old saying that when the shoe-shine boys start chatting you up on the stock market, it's time to sell. Remember during the tech bubble when the tv at the bar was tuned to msnbc instead of sportscenter? kinda like that. If it ever really gets bad enough that you think gold will be your saving grace, it's too late. When what you need is a jug of water, your chunk of yellow metal isn't really going to do it. Gold was a dog for many, many years, ran up quickly during the financial crisis. Buy real estate. The fed is buying mortgages, not gold. Ride the fed wave for a while.

[Louis]

I assume all this "the sky is falling" talk is due today's inauguration for a second term.

There was similar talk at the beginning of the first term, but much like the folks who were predicting the end of world based on the Mayan calendar, it was all paranoia. But you never know ... maybe the UN troops in the black helicopters will be coming to take away your guns and herd you into the secret detention camps. Better run out and buy some more AR-15's just in case.

Having said that, I'm all for a balanced portfolio - but it should be based on rational factors, not AM Talk Radio blather.

[cfox]

The current Central Bank / fractional reserve financial system is the greatest form of slavery ever devised by mankind.

Funny how living standards have improved during this time of fractional reserve, and how many recessions haven't turned into depressions (now that the Fed has learned not to tighten during a severe recession). I'm sure that's all a coincidence, though. I say we go back to the gold standard and experience the kind of deflationary nightmare that made ketchup soup my Grandfather's favorite treat.

[54ny77]

gee, maybe monex cycling team will come back after all...

[Ralph]

I assume all this "the sky is falling" talk is due today's inauguration for a second term.

There was similar talk at the beginning of the first term, but much like the folks who were predicting the end of world based on the Mayan calendar, it was all paranoia. But you never know ... maybe the UN troops in the black helicopters will be coming to take away your guns and herd you into the secret detention camps. Better run out and buy some more AR-15's just in case.

Having said that, I'm all for a balanced portfolio - but it should be based on rational factors, not AM Talk Radio blather.

Generally I figure the various markets will not do what most expect. So.....I'm very bullish on the USA and traditional stock market investments. WE'll solve the deficit spending one day, folks both here and abroad will regain confidence in the future of the US, money will flow in to build plants and infastructure, jobs follow, tax revenues will drastically increase, and the US will still be the best place to invest. Be negative if you wish, but history suggests you're wrong. BTW.....If you really want to make big money, short treasuries. With treasuries rates at 31 year lows, and treasury bond prices at 31 year highs, that's the current bubble.

[the bottle ride]

.If you really want to make big money, short treasuries.
Too hard unless you have the crystal ball- you have the coupon to contend with.

[jr59]

I freely admit I read a lot about what these so called experts say about what will happen to gold.

That being said, I have 1 question;

If the writers of these blogs/papers/projections really knew what was going to happen, then why are they writing for some website/blog?

Why would they tell the masses, and not just do what they all claim to know?

:eek::eek:

[Louis]

Why would they tell the masses, and not just do what they all claim to know?

The same goes for every other get-rich-quick scheme you see advertised anywhere.

Apparently they've already made so much money they don't need any more, so they're sharing the secrets with us out of the kindness of their hearts.

[Ahneida Ride]

In Ben's own words ....

"Let me end my talk by abusing slightly my status as an official representative of the Federal Reserve.
I would like to say to Milton and Anna: Regarding the Great Depression. You're right, we did it. We're very sorry. But thanks to you, we won't do it again."


here is the link and the quote is at the end. http://www.federalreserve.gov/BOARDDOCS/SPEECHES/2002/20021108/default.htm

---------------

Banks over book 10 to 1 using the Ponzi scheme of fictional reserve.
They create $ outa nothing and charge interest on nothing.
They are mathematically unstable. Please see below.
100 frn is in vault. there are 1000 in claims against that 100.
Imagine a hotel with 100 rooms that books for 1000 rooms.
or a plane with 100 seats against which 1000 tickets are sold.
Too many people show up and the Bernie Madoff scheme is espoused.

http://upload.wikimedia.org/wikipedia/commons/thumb/0/01/Fractional-reserve_banking_with_varying_reserve_requirements. gif/360px-Fractional-reserve_banking_with_varying_reserve_requirements. gif

Hence the need for private central corporation to bail em out
when the Ponzi scheme gets into trouble.

We now have 100 years of a private central corporation that
controls our money supply and it's value.

The dollar has lost 97% of it's purchasing power and our nations
true debt estimated at over 100 Trillion.

http://stopnationaldebt.blogspot.com/p/116-trillion.html

No one should be allowed to create $ outa nothing and charge interest
on nothing. President Kennedy tried to issue 500 mill in United States
Note, not fed reserve notes. We would have not paid interest on these
notes.

Ben is right. It won't happen again. What will will be far worse.

[choke]

Having said that, I'm all for a balanced portfolio - but it should be based on rational factors, not AM Talk Radio blather.I try to keep mine balanced; I buy Highlands, Islays and Speysides. :)

[dumbod]

I thought that Andy Tobias summed it up best a couple of decades ago.

"The French peasant has always understood this (physically holding gold as a hedge) and thus has traditionally buried a few gold pieces in a safe place. Of course, the fact that, after several centuries, French peasants remained peasants seems to discredit this theory."

[Climb01742]

both of my parents (may they rest in peace) lived through the depression, and they kept gold and silver coins in their house. i think life experiences shape your feelings about physical precious metals. being poor in the rural south in the 1930s sure stuck with my folks.

[MadRocketSci]

gold's value is inversely proportional to confidence. It is shiny blingy stuff that people have coveted since the beginning of civilization, and a world-wide symbol of wealth. It is no government's liability, and thus cannot be created out of thin air or manipulated in other ways. It can of course be pulled out of the ground, but at a rate much lower than any currency is being diluted, despite the efforts of Newmont, Goldcorp, El Dorado, Yamana, BHP, and others to do so as quickly as possible.

Confidence is not low right now. People are starting to think that the worldwide economic situation is on the mend. I've always been the contrarian so I don't buy this, but I don't think gold has huge upside in the near term, and may drift lower. Under 1500 i'm a buyer.

[cnighbor1]

I don't hold asset's that have little use. Gold is used in jewelry, gold conductors, dentistry and a few other uses. But the major use of gold is a hedge against an economical collapse. so when that happens gold will come out of storage and flood the market. it will collapse in price has there aren't many uses for it. and there you are trying to sell gold in a fast losing value market. Doesn't make sense to buy when low in price to store for latter use. silver on the other hand has a lot of uses and has out preformed gold for a number of years

[MattTuck]

A timely info graphic I just came across.

http://www.visualcapitalist.com/portfolio/gold-history-of-gold-part-i

[the bottle ride]

Nice piece MT

[54ny77]

i prefer italian gold...

http://3.bp.blogspot.com/_azSpIfwIB3c/S7ODTXMw4dI/AAAAAAAAEtU/P4JR0vC9U9U/s1600/Picture+4.jpg

http://1.bp.blogspot.com/_jhYS_tF31QE/TMNj1lIpx7I/AAAAAAAABLg/Vc6ejySi82s/s1600/27+pinagold+(7).jpg

http://www.speedbicycles.ch/KW_4812/speed_030.jpg

gold-plated colnago as presented to a guy in a white robe who lives in rome...

http://2.bp.blogspot.com/_CIyavhtMTj0/SYtmgznt-KI/AAAAAAAABLk/Lkm3AysbVDU/s320/ErnestoColnagoPope.jpg

which looks something like this...

http://4.bp.blogspot.com/-kb68gOonIlE/T0xZ44RBNNI/AAAAAAAABA8/upMYRC_Lwd4/s1600/pope+017.jpg

[saab2000]

The same goes for every other get-rich-quick scheme you see advertised anywhere.

Apparently they've already made so much money they don't need any more, so they're sharing the secrets with us out of the kindness of their hearts.

Bingo. Anything Glenn Beck advocates with such hearty enthusiasm bordering on paranoia I'm highly suspicious.

Precious metals will not protect against collapsing markets as it too will change in value.

If I were trying to prepare for an economic apocalypse I'd be buying farmable land near running water in a very, very remote area. I wouldn't be hoarding gold.

[MadRocketSci]

people forget that gold is money. i've used the example here before that I can trade gold for goods anywhere in the world, including deep in the amazon with the native tribes. As such, you will find many people talking about using it as an inflation hedge, but as money I think it would hold up better in a deflationary environment.

during a mass crisis with roaming militias and general lawlessness, it might not get you much more than some food and shelter, but if you manage to survive and civilization recovers, you will have the only portable persistent means of recovering your pre-apocalypse wealth.

[Flying Pigeon]

..that you can chew your food with:
http://3.bp.blogspot.com/-nQUS0HFKfKQ/TXeOuXR46sI/AAAAAAAAEBU/g0dYWAANpz0/s400/2%2Bgold%2Bteeth%2Bfor%2B%2524100.jpg

[54ny77]

will i be able to get spare sram parts in such an environment?


during a mass crisis with roaming militias and general lawlessness, it might not get you much more than some food and shelter, but if you manage to survive and civilization recovers, you will have the only portable persistent means of recovering your pre-apocalypse wealth.

[zap]

will i be able to get spare sram parts in such an environment?

nah, Campy is the only commodity of it's type worth anything.

If nothing else, you might be made to work in the fields for watery soup if sram is found in your possession.

[MattTuck]

http://worldcomplex.blogspot.com/2013/01/gold-guarantee-blowing-up-in-singapore.html

Saw this tonight. I guess the act of physically holding gold prevents something like this from happening to you.

[Louis]

So if you take possession of the gold yourself, it seems to me you then have only two options: 1) hide it or 2) put it in a safe-deposit box in a bank. However, if you're the type of person who feels like they need the gold in the first place, I don't see how either of those choices is terribly reassuring.

[1centaur]

Readers of this thread may enjoy this piece, and especially the comments:

http://seekingalpha.com/article/959071-which-is-better-physical-gold-or-gold-etfs

As I suggested earlier, it's fascinating how detailed the fears are among gold buyers: counterparty risk, fake gold, government confiscation even from your safety deposit box, etc. And yet the philosophical question of why it's OK to take those risks on the 60-95% of the portfolio not in gold are unasked. There's an underlying theme of control of your own destiny that would take a lot of couch time to unravel. As I said before, if we get to a point where actually having physical possession of gold is crucial to survival because government has allowed/enforced the notional value of electronic-record investments to be stripped from individuals and probably institutions, the odds of prolonging any reasonable standard of living are vanishingly small. Either your remaining gold will be taken from you by force or the world won't really be worth living in.

One of my investing lessons over the years is not to invest based on what can be imagined rather than what can be analyzed to tilt the odds in my favor. Imagination can lead you down many unwise roads. The odds of a massive blow-up are slight and the ability to live a good life thereafter questionable. Take that risk! Use gold or gold proxies to even out your net worth under inflationary scenarios and through market declines if you wish, but the implied weights in a portfolio designed to encompass the odds of each possible outcome will not be so great that holding physical is desperately important - i.e., 5% of assets in gold might as well be in non-physical that can be sold in a moment since losing 5% to very unlikely shenanigans won't kill your portfolio value. If you have 80% of assets in gold for an end days scenario, hold physical and grow vegetables off the grid. Either be fish or fowl; don't be neither and pretend it's optimal.

[cnighbor1]

When holding Gold, Silver, etc your really saying I think the world economy is going to go thru a serious downturn. So how serious? How big an investment in very safe investments. Than if it doesn't happen what than. sit and wait while value of your safe investment just sits there gaining no value.
I don't see how you really base you life on waiting for the world to collapse

[Louis]

I don't see how you really base you life on waiting for the world to collapse

That's not as uncommon as you might think - depending on the denomination it happens in varying degrees every Friday/Saturday/Sunday (pick a day of worship) in congregations throughout the world.

[RkyMtn]

I thought about it, but I just use the ETF. If all heck breaks loose enough to kill the market to the point in which you cannot trade your ETF's, then owning gold in physical form is useless. The ultimate currency then will be food, water, bullets and guns.

When I was buying bonds back when I was in the financial world, the #1 rule was: How do I get out of this position (e.g. where is my market to sell this and how much is it going to cost me?) Holding physical gold could work as long as your market to sell it doesn't rape you in fees.

You would probably be best off stocking up on Charmin for a doomsday scenario!!

[Louis]

You would probably be best off stocking up on Charmin for a doomsday scenario!!

Or Tide liquid detergent - real life evidence that the end is nigh (http://nymag.com/news/features/tide-detergent-drugs-2013-1/)

[MattTuck]

Daily show on the subject of gold. (http://www.thedailyshow.com/watch/wed-april-24-2013/the-golden-rage)

[MattTuck]

And gold just broke $1200 an ounce.

Graph of precious metals from the time I started this thread. :help:
https://lh3.googleusercontent.com/-Xh7EQOnTARk/Ucx_x9OHIAI/AAAAAAAAEgs/-qei9q1SICw/w958-h562-no/goldchart1.png

[Louis]

And gold just broke $1200 an ounce.

Moral of the story: Figure out what Matt's buying and short it. :)

[Ahneida Ride]

You would probably be best off stocking up on Charmin for a doomsday scenario!!

I do ... I do ..... and the 100 fed preserve notes work just as well as
the 1, 5, 10, and 20 fed preserve notes. !

http://silverdoctors.com/wp-content/uploads/2013/05/toilet-paper-money1.jpg

[redir]

Buy low sell high, don't buy gold when it's running up. I don't own it as I think it's really only worth it if you have a ton of cash laying around with nothing to do. Then it's a nice hedge and the cash you put into it will be safe. I also would never buy coins and store them. I like coins and collect them, don't have any gold ones but would love to. But that's priced by numismatics and not by weight of gold. If you buy gold then it really needs to be certified or what they call good delivery and is kept in vaults and very well documented. That's the price of gold that you see in the papers not the coins that are hidden in your personal safe.

Of course if the SHTF then the gold in your save might be worth more since you cannot get to your gold in London but then if the SHTF you and the rest of us are screwed anyway. At that point who needs gold I need food! So if you are a paranoid anti government type then you are a fool to invest in gold. IF you have large sums of cash that you can totally live without then buying gold makes a lot of sense.

That's my take on it anyway.

[54ny77]

buy gold plated colnagos. at least you can use it AND stare at it. and if it rises huge in value, sell it. win-win. ;)

http://2.bp.blogspot.com/_duzjJ0yJ9SA/TOlv1U99LSI/AAAAAAAAHTA/P4d09qDiB3I/s1600/6f2f_3.JPG

[Ralph]

People have been talking about the need to own gold to hedge against about every calamity you can imagine my whole life. I'm 72 now, (and a retired financial advisor), and the world hasn't ended yet. I imagine the same argument has been made for hundreds of years. For some reason, many people will buy into this kind of fear mongering argument. Same as some need religion as their crutch. It makes them feel better, more secure, etc.

However....to me, gold is just another asset class. Not unlike real estate, stocks, bonds, tulips, etc. And there are times when it's going up, and times when it's going down. Get that right, and you can make money in gold. Either long or short, holding the metal, or holding mining companies and ETF's of gold stocks. To me....gold has more risk to the down side than to the upside at it's current price. And no....I don't own any bullion. That's not how I would "play" gold if I wanted to work that market.

[MattTuck]

pssst. Blue horseshoe LOVES tulips!

People have been talking about the need to own gold to hedge against about every calamity you can imagine my whole life. I'm 72 now, (and a retired financial advisor), and the world hasn't ended yet. I imagine the same argument has been made for hundreds of years. For some reason, many people will buy into this kind of fear mongering argument. Same as some need religion as their crutch. It makes them feel better, more secure, etc.

However....to me, gold is just another asset class. Not unlike real estate, stocks, bonds, tulips, etc. And there are times when it's going up, and times when it's going down. Get that right, and you can make money in gold. Either long or short, holding the metal, or holding mining companies and ETF's of gold stocks. To me....gold has more risk to the down side than to the upside at it's current price. And no....I don't own any bullion. That's not how I would "play" gold if I wanted to work that market.

[Rueda Tropical]

Bought at around 430 and sold when it passed 1300. At these prices I'd have to have a huge amount of assets to dedicate some part of them to gold.

A lot of the current interest in gold seems to be based on ideology / religious fervor rather then anything rational. I've been hearing how because our debt is so high and our currency so worthless that no one will loan us money, interests rates will skyrocket and the zombie apocalypse will ensue. Instead the opposite has happened. People keep shoving money at us for pathetic returns, inflation has not exploded and Armageddon still hasn't arrived.

How many years can you be wrong before people stop taking you seriously?

[the bottle ride]

US debt/treasuries are now a binary trade- there is no other place a central bank can go
nor could they sell their stash of bonds in any meaningful way with out hurting their own treasury position

US dollar is here to stay- we are the least ugly sister

[cnighbor1]

there been a great deal number or articles that state that Gold ETF (symbol: GLD) DO NOT HAVE the physical GOLD on hand to match what has been sold. they have the option to pay holders in cash in case of a run on selling gold. So GLD is not a great investment. the only way to own gold is too own the gold itself. Gold bars are the best. Gold mining stocks is another way to play gold but they trend to follow the general market so there goes any advantage there. I read a very long article on how to own gold and only method that is safe is too own gold. Coins are over priced. jewery requires you to melt it down to get the gold.

[Pete Mckeon]

:banana:we could be in much worse countries when viewing financially:bike:


US debt/treasuries are now a binary trade- there is no other place a central bank can go
nor could they sell their stash of bonds in any meaningful way with out hurting their own treasury position

US dollar is here to stay- we are the least ugly sister