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Updated over 3 years ago, 03/23/2021
How do you hold & protect physical gold?
I guess it depends on the size and weight? If it is small enough to put in ur own safe at home, go for it. However, it wouldn't be inconvenient and unwise if not.
Anthony Gayden I would tend to agree for the most part, I'm not thinking about this from an "investment" perspective necessarily...coming more from an inflation-hedging perspective and/or perhaps as a bit of protection in a SHTF scenario.
Cody L. I am definitely coming from the SHTF line of thinking as well. I am investing in real estate as well and am also invested in some paper assets, and I also prefer the idea of storing value in gold versus silver due to your point exactly.
A friend of mine said he didn't like gold because it wasn't liquid enough. I told him gold IS liquidity. Paper money used to be just receipts for (backed by) gold and silver. Now they're just the same -- just w/o the backing. So that's better now (in terms of holding paper currency)?
Originally posted by @Chris Martin:
Hard to buy a loaf of bread ...
Originally posted by @Jeff B.:
Originally posted by @Chris Martin:
Hard to buy a loaf of bread ...
That's some expensive PB&J sandwich!
The 86 acre parcel has deer and other game on it. In a truly apocalyptic scenario, I'd rather be there with appropriate survival implements. I'm not a prepper, BTW. I just think some undeveloped land is part of the big picture strategy as others think a piece of gold is.
If you look at how a lot of people have escaped countries in the past during political turmoil, they use things like gold, silver, diamonds, etc. Paper currency of their former country becomes worthless. No matter what country you go to, precious metals have value. They are easy to transport, can have significant value or be in smaller denominations, and keep their value.
@Chris Martin The SHTF people have the land already, they want something with value they can transport if they need to.
Kevin Coggins
I'm Enjoying this conversation and appreciate the charts!
Originally posted by @Account Closed:
Originally posted by @Kevin Coggins:
Unless you buy when gold is low, you're not really going to make any money on a gold "investment".
Be careful when looking at charts like these - they are deceptive. I'm not defending Gold (or silver or any other precious metal) as an investment...but I want to point out the inaccuracies. The chart above doesn't take into account Executive Order 6102 which essentially made it illegal for Americans to own Gold coins and Gold Bullion. Nixon ended that by taking us off the "gold standard" in 1974. There's a reason why the Dollar and the price of gold tracked closely together from 1933 to 1974...and a reason why you see such a big change after 1974.
Precious metals (gold and silver) are a good hedge against inflation. Check the rate of inflation in 1980 (six years after going off the gold standard) vs the rate of inflation in 2000. I can remember my grandmother buying certificates of deposit at 12% and 16% interest back then.
I was just trying to illustrate the long term returns of gold vs. stocks vs. bonds. It really just depends on your risk tolerance, and for me right now, I prefer the higher returns and can deal with big dips in the markets (I have only about 5% in bonds). If the price was right I'd consider buying gold, but it'd be on a huge dip in price.
Inflation historically is only at 3.2% and recently has been around 2.2%. CD's at 16% would make me re-think investing in the stock market (but 20% interest rates would be a killer on the flip side). I'm just not quite in a place where I need to be concerned about hedging against inflation, got a long way to go until I can start trying to preserve my wealth.
Originally posted by @William Walker:
@Account Closed
No need to be sorry, hopefully my investment choices don't affect you.
Each type of investment has its role, the benefit of precious metals is that you can physically have them in case of emergency (or to caress). It defeats the benefit of precious metals if you have them in paper form or store them where you can't get to them in an emergency.
I'm not a domesday kinda guy, just recognizing the role of precious metals in an investment strategy.
It is an interconnected world!
Regarding gold, it is usually a longer term strategy although there are always those looking to capitalize on short term price movement.
To get some perspective on gold, between 2011 and 2015, worldwide, the total quantity of gold produced averaged 2,848 tons per year. Currently, 1 ton of gold goes for approximately $40,576,000 million
If you have $40.57 million laying around that you are certain you won't have need for in 20 or 30 years, but that you cannot afford gambling with by investing in riskier or other comparatively illiquid assets, you would look to gold to solve that problem.
Investors typically like the reasonable assurance (if there is such a thing in investing) that it will hold its value and in all likelihood increase when they need to access the funds. Between Jan 1969 and Jan 2016 for instance, gold have averaged 10.58% per year and a median of 6% per year which beats inflation.
Think in terms of a monetary 'store of value' especially in the long term. The theory of gold having an inverse relationship with equities is shaky and doesn't always hold true based on what time frame you are looking at.
I understand anyone wanting to diversify their investments, but I also suggest you look up and watch Warren Buffets take on gold vs. businesses, or stocks in a business. He can explain it a lot better than I can, but the idea is that something like a business, real estate, or farmland will almost always hold some sort of value, and give you a constant return that is not as speculative as gold. Basically buying it in hope that someone will pay more for it later. Gold may be cool and nice to look at, but in my opinion, I'd rather take the advice of the most famous investor of all time and buy assets that produce something.
Originally posted by @Bill Goodland:
... but the idea is that something like a business, real estate, or farmland will almost always hold some sort of value, and give you a constant return that is not as speculative as gold. ...
Speculative? Then what do you call buying a stock? How many companies on any exchange have been trading for say the last 200 years? How many companies currently trading today will be trading 50 years from now or even exist at all?
If you really have the hard on for gold and need more than a few bars, you can always try to buy the company (not just the stock) GoldCorp GG with current market cap about $12 billion or see if you can get Newmont Mining Corp NEM with current market cap about $18 billion. These are businesses in the business of mining Gold and other precious metals.
The historical performance gold is public information. Investors invest in any array of assets based on what their objectives are and more importantly, facts not necessarily emotion. You need to do some research into the topic of demand and supply to better understand the rationality of investment decisions.
The CME Group offers Gold futures that can be used to invest in the gold market without holding the gold physically, these financial instruments can be used to speculate. Holding gold is very dangerous and impractical. If you physically have to invest in gold, then try putting it in a safety deposit box.
Originally posted by @Paul Staszel:
The CME Group offers Gold futures that can be used to invest in the gold market without holding the gold physically, these financial instruments can be used to speculate. Holding gold is very dangerous and impractical. If you physically have to invest in gold, then try putting it in a safety deposit box.
When you start talking about the futures market.. this is a market where people go to for various hedging and speculative activities not just in gold any hundreds of commodities. In the stock market, there are those who buy stock and hold for whatever their holding period is and then there are those that delve into options contract which is a different level of speculation.
#5 Wholesaling Contributor
- Real Estate Broker
- Naples, FL
I quit buying gold as an investment. I DO buy 20 Libs and Saints because I like their looks, they are pre-1933, and I have always had a numismatic appetite.
Eagles, Maples Leafs, etc....no interest. Even the US 20 Saints or Libs WILL offer protection if the SHTF.
If you want to buy or sell gold, consider attending the FUN show. Google it. They have it twice a year and it is the largest coin show in the country. Every now and then you can find a bargain there as well. Typically, the bargains will NOT be in bullion but rather pre-1933 gold. I LOVE that stuff...to me it is soooo cool! Miss Liberty is sooo awesome in this design originally done by Augustus St Gaudens.
Chris Martin, order and read James Rickards' newest book, The Road to Ruin.
It reads like a textbook on the History of Money. The man is brilliant and rubs elbows with the world's wealthiest. He teaches the reader how to read the very public jargon of the world's elite.
In chapter nine all is revealed. Hint, in Rome there is single family who are the sole owners of the Plaza Colonna. This wealth family has controlled their wealth for 900 years for over 31 generations. Rickards muses... "Here is a family fortune that had survived the Black Death, the Thirty Years War, the wars of Louis the COB, the Napoleonic Wars, both world wars, the Holacaust, and the cold war... That kind of wealth and longevity could not be due merely to good luck... There had to be a technique."
A telling portion of a quote that follows: "...art, land, and gold are the things that last."
Later he imagines "..An early 17th century noble, hearing marauding armies approaching his manor, could remove his paintings from their frames, stow the canvasses in a sack, put his gold in a pouch, and ride away with both in tow. Months later he could return to the manor, reclaim possession, stack his gold on a table, and hang his art on the wall. His wealth would be intact, while his neighbor's wealth was perhaps destroyed.
Rickards make the point "Land can be lost. Nevertheless, good title to land, once established, is durable. ...There are thousands of Cuban refugees in Miami who will show you deeds to properties in formerly wealthy neighbourhoods of Havanna. They took these deeds with them when they fled the Communist takeover in 1959. Many of the homes were occupied by party officials. Some have been destroyed. Yet the refugees still hold title and they, or their descendents will return someday. As the US and Cuba normalize relations, those titles will not be ignored.
..."An interesting 21st century take on this millinarian portfolio is that land, art, and gold are nondigital. They cannot be wiped out by power outages, asset freezes, or cyberbrigades.
1/3, 1/3, 1/3 was the basic portfolio of the Colonna family. Me, I'm not into art. Rickards' advice is to acquire "museum quality" art. That, for the most part, leaves me by the wayside.
... But I can learn from his book and adapt my investment plans to aid me and my descendents... probably less than 5% in the stock of businesses that have a century or more of "survival history". 😊
In former Communist East Germany there's a Christian family I know who did well as bakers in a very small town... Though the apparatchiks approached them to "join the cause", they wisely refused. Bread, in their case, was Life to them and the communities they served.
When I served as a missionary in Haiti, I saw the value of local bakeries... as they are (valuable) in all developing nations... this is a fact of life known by missionaries throughout the world.
My real estate interest is in farmland and small producing farms outside of metropolitan areas.
I'm looking to invest in a very special local bakery near where I'm increasing my holdings in farmland.
Louis the XIV...
Rickards suggests family businesses to provide cash flow for "necessities".
Rickards' previous bestseller was "The Currency Wars". As I said, the man understands money... He's a consultant to the CIA, and banks internationally.... But don't take my word for it, read his books.
In a SHTF scenario, gold is worthless. Firearms, ammo, drugs and alcohol will be the units of trade.
The interesting thing to me is that if you exclude the top 1% in net worth in the US, gold (or any precious metal) doesn't even show up as an asset class in . In other words, as a group, people with a net worth of less than $3M or so have insignificant precious metal holdings.
By , the over $3M in net worth people are more inclined to own works of art than precious metal holdings.In SHTF cases, other commodities like LEAD and fuel (diesel and gasoline) would be more valuable to me.
Originally posted by @Account Closed:
In a SHTF scenario, gold is worthless. Firearms, ammo, drugs and alcohol will be the units of trade.
This depends on your definition of SHTF. If you're thinking mad max, the road, or something along those lines, then I agree. If you think more along the lines of things that have happened in history and are even happening now, precious metals have great worth.
I tend to agree with the 'Gold won't do you any good in an SHTF/apocalypse/economy collapse/natural disaster scenario' opinions. I grew up collecting coins and at one point had a lot of gold and silver bullion. A few years ago I sold it all and invested in a few gold and silver stocks that either pay dividends or good growth prospects. They're diversification for my real estate and an inflation hedge pure and simple. I did hang onto a small amount of silver dimes because they seem like they might be exchangeable for food or guns if needed. Otherwise I just don't get it.
Originally posted by @Account Closed:
In a SHTF scenario, gold is worthless. Firearms, ammo, drugs and alcohol will be the units of trade.
Apparently she likes to bling... http://reut.rs/2stsWmy and obviously haven't been reading your post! lol
I am thinking along the lines of William Walker here. The economic prospects given the US debt and deficits, and lack of will to anything about the trajectory of either of these, I am putting some funds into physical gold, mostly as an inflation hedge.
This article covers all the ways you can store gold, from backyard burial to secret safes to professional storage abroad: https://goldsilver.com/blog/how-to-store-gold-at-home/