Discussion in 'Speaker's Corner' started by fester, Feb 4, 2009.
can anyone suggest a good place to make small investments in gold?
Typically that'd be jewelry however uk currency in gold is tax free, the most obvious choice long term at least
My take, whatever you think will happen its not a bad idea to hedge bets and have some solid assets
Thought I'd check up on this again. I wonder how many people jumped on the bandwagon at the top of the market because they felt the return on other "safe" assets were so low. At least they wouldn't have devalued so much and would have provided an ongoing return of 1% or so.
Gold which was supposedly a hedge against the inflation that QE was going to cause has fallen because that inflation failed to materialise. QE has been at it's peak for quite a while now and there is no danger that inflation will go far above 2% anytime soon. In fact the Fed and BoE don't know how to wind it down because of such low prices and relatively weak global economy. They might just let all those bonds mature and return that money back to government, and it will just fade into the continuous money supply growth that happens anyway.
As interest rates rise next year, gold which provides no return will look even worse. At least now whilst inflation is low, so is the return achievable via bonds.
On the other hand if we look at an example of a fund that pensions are usually invested in (global equities + dividends)
over the last 5 years it has grown at 10% per annum on average (as of July). Although that will have taken a hit this August.
Gold is so passe. Given what's been happening in the French markets, I've been dabbling in GB passport futures, shorting Eurostar, and forexing the franc out of the Dinar.
I've also got a chunk in a little fund that's paying 7% net income and spreads risk throughout a variety of blue chips.
They put up rates and gold rose which is some sense is predictable I think. The main reasoning is anticipation of that rise and the 'surprise' that FED appears to be doing more rises this year.
I think inflation is far above rates used by all the major reserve currencies, we have negative effective rates and in some cases actual negative rates. Overall the case for gold continues to be good, I expected a bigger spike down before this rise Im not sure if thats the bottom but as a hedge its still working long term imo
Out of curiosity (because im too lazy to look) if aomone bought 1oz of gold when this thread was started and kept it till now how much more or less would it be worth.
The recent low matched the 2008 high, usually that kind of thing is the case. So its a profit, I have gold from the start of this thread in our national currency. However its more then fair to say you could have done more useful things since 2008 then keep a fancy coin in your pocket, the vast majority should be paying off their mortgage on a house they use everyday. Governments on the other hand should have at least some tradable solid worth
Gold in sterling terms this year has done very well and rising overall anyway. So long as reverse banks have weak policy and favour easy money its likely to continue to rise. With so much debt and lack of supporting factor to sterling dollar or euro even I cant see much reason for apprehension.
Much like what this guy says:
Anyone heard about what Goldmoney is doing? My understanding is limited, but I think it's a company's attempt to make gold into a more utilitarian commodity for payments and savings. They have released a mastercard that's based on gold i.e. you put money on it and then they will buy that value of physical gold from a real vault for you and if you want, you can go to the vault where it's stored (though, it might be in switzerland) and walk out with it. If you buy something, say from a supermarket, with your card, it sells some of that gold and converts it into your currency so that you can make a payment.
I think it sounds great but idk all the ins and outs of it. What do you think?
So basically an utterly faith based currency held to ransom by not only the company, your government and a forgien government.
And subject to fluctuating leices and likley extortinate currency exchange fees
Assuming the gold is actually real and even enough ro cover all the cards.
Far far worse than any paper or electronic currency
Well, I'm saying it's a good idea IMO if it's legit. If their charge rates are very high then maybe not. I don't think the company is holding anyone to ransom if you truely own the gold. Maybe foreign governments could though, if things changed. They also say they have 3rd party audits of the gold in the vaults.
I woud agree that physical gold at home is more secure but I think if this turns out to be legit and takes off then it could be interesting.
I competely dissagree with your last sentence if this turns out to be a decent company.
edit: goldmoney don't own the vaults themselves btw
governments have in the past made it illegal to hold gold, do you think the company would fight for you?
and if the world economy does collapse do you think they would honour your purchase or do a bunk?
pr the people who own the vaults, could too.
you're so far removed from the gold that its no different to paper money backed by nothing.
Yeah ok, you make some good points tbh.
main advantage if gold as i see it, is that you have a physical valuable commodity to hand when **** hits the fan
saying "we'll I've got some gold in Switzerland some where" isn't going to be as useful come the second great depression kind of event.
i must admit id be intersted to see how a currency like bitcoin survives/reacts to such an event though.
Yeah, I agree. I think I got over excited by the idea of gold as a mainstream currency, or at least, an attempt to make it one. I think I am going to focus on physical gold and silver (stored at home) and a long term food supply ^_^.
I think bitcoin could be interesting too but I guess I will probably chicken out and just go for something that can be exchanged physically and that most people understand.
yeah i think a big problem for bit coin could be regular brown/blackouts/ no one running the machines to process the transactions due to power costs etc.
I sold all of mine when it hit £1055.31 an ounce it's now £1015.38. I'll wait until it hits around £750 an ounce before I buy again.
Unless Sterling strengthens and / or gold weakens, you may be waiting a while...
And if the **** really hits the fan you are probably going to be wishing you had a warehouse of cigarettes and coffee rather than gold hehe.
Gold is more transportable then cigs or coffee and both spoil quite easily. All depends what the purpose is, gold is the ideal for transporting value and its hard to destroy.
I agree with you for the average bloke, just secure your costs like food and rental but gold is highly relevant to capital and trade especially globally. We dont grow tobacco in this country for starters
The point here is funny because that is what happened in the great depression. Gold outside the USA was useful for those raising capital to trade globally, gold within the USA was a problem as it was taxed. I wasnt there or anything but so far as I can tell common perception is off the mark and seems funny how revisionist history can be.
Events will repeat history demonstrating that point before worth is correctly attributed once again?
Right this moment Im optimistic on Sterling, not sure of the wider news why that might or if its just price action. If it holds 1.315 and beats 1.333 even then Im going to assume Im correct in breaking its downtrend short term
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