Gold is a bad investment or hedge?

[Tingles]

I view hundreds of YouTube videos read hundreds of forum posts - so I don’t know where this comes from...

“1925 was the last time a British Sovereign was in ‘normal’ use... value £1, today a Sovereign is valued around £125 £225!!”.  Best part of 100 years - hows that for currency debasement?

Pretty shocking.

[CosmikDebris]

1 hour ago, Tingles said:

today a Sovereign is valued around £125

More like £225!

[Tingles]

2 minutes ago, CosmikDebris said:

More like £225!

HAHA!!  Slip of the finger - I HAVE amended!! 

 

Thanks!

[Rgcoins]

I bought $1,000,000 worth of gold in 2010 at $1,800 per ounce. Around 550 ounces.

if I were to sell that today is get back $660,000. 

You do the maths. Golds the worst Investment out there. 

[RoughDog]

old next door neighbour told me she bought her 3 bed terrace house for £6K which was a lot of money.

 

 

[Mcgrimes]

46 minutes ago, Rgcoins said:

I bought $1,000,000 worth of gold in 2010 at $1,800 per ounce. Around 550 ounces.

if I were to sell that today is get back $660,000. 

You do the maths. Golds the worst Investment out there. 

I genuinely don't know if this is serious or sarcasm?

[Auricsstash]

@Tingles you might find this video helpful on currency debasement it’s not the whole story...

 

[Abyss]

Brazil, Argentina, India, Indonesia, Turkey and South Africa I would advise you to pull up chart on the local currency and the gold price in those currencies. During the emerging market crisis those individuals held gold oppose to their local fiat currencies have protected their purchasing power.

[Auricsstash]

@Abyss EM currency crisis is predominantly down to these countries having their debts in USD something we don’t have.

[sixgun]

2 hours ago, Rgcoins said:

I bought $1,000,000 worth of gold in 2010 at $1,800 per ounce. Around 550 ounces.

if I were to sell that today is get back $660,000. 

You do the maths. Golds the worst Investment out there. 

So you bought 550 ounces back in 2010 - in what form did you buy it?

The reason i ask is the top spot price for gold in 2010 was on 27th November at $1374 an ounce. So i will say you never bought gold at $1,800 in 2010.

4 hours ago, Tingles said:

I view hundreds of YouTube videos read hundreds of forum posts - so I don’t know where this comes from...

“1925 was the last time a British Sovereign was in ‘normal’ use... value £1, today a Sovereign is valued around £125 £225!!”.  Best part of 100 years - hows that for currency debasement?

From me.

[Tingles]

10 minutes ago, sixgun said:

So you bought 550 ounces back in 2010 - in what form did you buy it?

The reason i ask is the top spot price for gold in 2010 was on 27th November at $1374 an ounce. So i will say you never bought gold at $1,800 in 2010.

From me.

1925 was the last time a British Sovereign was in ‘normal’ use... value £1, today a Sovereign is valued around £125 £225!!”.  Best part of 100 years - hows that for currency debasement?

 

Thank you for the information.  I was astounded.

[dicker]

This question can be asked about any investment.....stock, fixed income, cash, fine wine, stamps, art etc.

Gold price is going down - partially due to the strength of USD, but there are likely to be other factors at play. Reasons are complex and no one really knows why investments behave as they do - if they did it would be easy to make money.

Is gold a good investment - that is a question that only you can answer and many on this forum will have very clear views and express them as such. PM's should be part of a portfolio on my view, not your entire portfolio and that gives you some balance and stability.

Gold is a good hedge against inflation (see Venezuela where the govt is issuing gold certificates backed by physical AU in place of the currency that they also issue...you could not make it up!) and the decline in value of currencies.  

Its genuinely interesting to ask the questions, but really no one really knows.  

PM's are a part of my portfolio but don't worry about price - I very rarely look at prices.  I just buy at set points to get pound cost averaging.

Good luck to you and all the best

Dicker

[Abyss]

Contagion. Turkey defaulted on their debt due to EM crisis European banks suffer. Contagion spread to the Euro and UK not achieved Brexit so in turn GBP impacted.

2 hours ago, Auricsstash said:

@Abyss EM currency crisis is predominantly down to these countries having their debts in USD something we don’t have.

Interconnected world with Banks and Corporations and sovereign countries. Welcome to the Global economy.

[Rgcoins]

2 hours ago, sixgun said:

So you bought 550 ounces back in 2010 - in what form did you buy it?

The reason i ask is the top spot price for gold in 2010 was on 27th November at $1374 an ounce. So i will say you never bought gold at $1,800 in 2010.

From me.

I mean receipt date September 5, 2011, In gold pandas. 

Roughly 500 ish, I live in Asia so we don’t play with tax and that stuff

[sixgun]

5 minutes ago, Rgcoins said:

I mean receipt date September 5, 2011, In gold pandas. 

Roughly 500 ish, I live in Asia so we don’t play with tax and that stuff

So i will assume you bought 550 1oz gold pandas. A graded 1oz gold Pandas dated 2011 have sold at around $1580. There would be a cost to grade them so let's say you could get $1500 after costs your 550 coins would sell for $825 000. Not the $660 000 you put out.

Yes if you actually bought that number of Panda you have an unrealised loss - worst investment? No. It would not take much to reach break even. How about you bought BTC at $20k a coin?

Do the maths. We don't tax on gold in Europe or at least most of Europe - i think there may be some funny rules in France.

[Auricsstash]

1 hour ago, Abyss said:

Contagion. Turkey defaulted on their debt due to EM crisis European banks suffer. Contagion spread to the Euro and UK not achieved Brexit so in turn GBP impacted.

Interconnected world with Banks and Corporations and sovereign countries. Welcome to the Global economy.

Turkey hasn’t defaulted on its debt since the 80s!!

And it’s not as simple as the “pumpers” would have you think.. The EU and to a much lesser extent the FED have created a system which is designed to catch fire.

Central banks have been taking on board large quantities of the debt banks are lending out leaving much smaller exposure on the banks balance sheets.

I have been studying this one for a while and in my opinion you won’t get another 2008 moment.

Because everyone now knows the play book when you do and there will be much less fear..

That’s not to say that gold is a bad investment, I just think over the next 3/6/9 months it won’t be a good investment..

[Lowlow]

17 minutes ago, Auricsstash said:

I have been studying this one for a while and in my opinion you won’t get another 2008 moment.

Because everyone now knows the play book when you do and there will be much less fear..

But that's exactly the hazard, that they "know the play book" and don't have fear.

The psychology isn't the problem, it contributes to the problem ... DEBT is the problem, and reassuring "investors" that you're going to bail them out doesn't solve that problem, it makes the problem worse.

[Auricsstash]

1 minute ago, Lowlow said:

But that's exactly the hazard, that they "know the play book" and don't have fear.

The psychology isn't the problem, it contributes to the problem ... DEBT is the problem, and reassuring "investors" that you're going to bail them out doesn't solve that problem, it makes the problem worse.

The reserve currency of the world is the $ while ever America can print currency and have it accepted the world over the U.S government debt will remain manageable. U.K EU China and all the rest of the developed economies are the same.

EM’s are where the problem is and that problem is so small that gold prices in developed economic currencies is down.

Psychology is everything when it comes to gold prices, fear is what drives its price!

The business cycle we have is based on the debt cycle “but” that system is designed to leave more debt in the economy each time it resets not less...

[Lowlow]

We're in unexplored territory ... we've never had the entire world so over-leveraged and all using fiat ... so there's no way to know how it will play out, except to say that fundamentals do, ultimately, matter.

[Auricsstash]

We are not in uncharted territory, we have a 100s of years worth of data to understand exactly how it will work as they all run pretty much the same way.

What seems to be the sticking point is how big the debt numbers are... It’s higher than last time and next time round it will be even higher this is how the system is designed!

If you have an interest check out the following video..

 

[Lowlow]

6 minutes ago, Auricsstash said:

We are not in uncharted territory, we have a 100s of years worth of data to understand exactly how it will work as they all run pretty much the same way.

What seems to be the sticking point is how big the debt numbers are... It’s higher than last time and next time round it will be even higher this is how the system is designed!

If you have an interest check out the following video..

 

I don't know how old you are, but before 1971 the currency was a different animal, we're in a period of time now that we've never been in.  I'm not talking about "how big the debt numbers are", I'm talking about the debt ratios - personal savings rates, debt-to-gdp, etc.I

Personally I don't care if anyone agrees or not, I just say what I think, and continue to try to decide whether cash is better or worse than precious metals.  It all depends on how they address it, ultimately ...

[JunkBond]

3 minutes ago, Lowlow said:

before 1971 the currency was a different animal

👍

[Auricsstash]

@Lowlow I’m old enough to remember the 70s. U.K. national debt is pretty good compared to where it has been. I highly highly suggest you watch the above video.

[Lowlow]

35 minutes ago, Auricsstash said:

@Lowlow I’m old enough to remember the 70s. U.K. national debt is pretty good compared to where it has been. I highly highly suggest you watch the above video.

 

I'm very familiar with Keynes and debt cycles, thank you.

So am I to understand you to be making a case that UK and U.S. debt levels are not a concern ?

[Auricsstash]

@Lowlow Why am I expected to do all your leg work? If you had taken the time to watch the above video and understand it’s content you would have been able to answer your own question...