Gold vs. Paper Dollars
There was a recent MSN and article about gold. Naturally, it ran along the lines of many left-leaning publications which is that gold is a barbaric investment, one that earns no interest driven by fear and is surely about to crash.
So, let’s look at the other side of the coin, so to speak … None of these same publications said buy gold in 1999 2004 or 2009 ,but they ran articles every day about how you couldn’t lose money in real estate. You better wake up. When the liberal press tells you something about investing, you better do the opposite! Read more
It is important to keep in mind that the end game is that gold will not make you incredibly wealthy unless you are leveraged. In theory just owning gold will keep your wealth about constant. To truly increase your wealth in the long-run you have to either buy gold on margin, but options, or invest in gold mining stocks.
Spot Gold Price Increases
Today, the Dow Jones index dropped 318 points, yet, the spot gold price increased by eight dollars per ounce and closed at $1270.
If you look at the chart below, to me it looks like after the big gold selloff, the spot gold price looks like it put in a double bottom around $1200 per ounce. Read more
Gold plunged 28 percent in 2013, ending a 12-year bull run, after the Fed announced plans to unwind the ultra-loose monetary policy starting January 2014, tarnishing the metal’s appeal as a hedge against inflation. Gold price was nearly $700 below a record hit in 2011.
2013 was a great year for stocks. U.S. stocks returned 33.45 percent as measured by the Vanguard Total Stock Index Fund ETF (VTI) with dividends reinvested. This is far better than the S&P 500 return of 29.60 percent and the Dow Jones Industrial Average of 26.50 percent.
Owning equities when Great Depression II comes along will be like owning bars of soap when there is no water and you are starving to death.
Gold Prospecting Seasons Greetings
Please accept with no obligation, implied or implicit, my best wishes for an environmentally conscious, socially responsible, low stress, non-addictive, gender-neutral celebration of the winter solstice holiday, practiced within the most enjoyable traditions of the religious persuasion of your choice, or secular practices of your choice, with respect for the religious/secular persuasion and/or traditions of others, or their choice not to practice religious or secular traditions at all. Read more
Gold to Pay Fixed Debts
Using gold to pay fixed debts. Let’s say I have a loan on my car, for say, $15,000. I bought 10 ounces of gold @ $1,200 per ounce. It jumps to $4,500 per ounce. Instead of having $12,000 in gold, I now have $45,000 in gold. A profit of $33,000. I cash in four ounces of gold and pay off my car. Same could be true of my home mortgage. Read more
Why Own Gold?
A friend of mine from Taiwan told me, “Gold won’t burn like cash, can’t be taken from an account like a balance on deposit, and is anonymous. It is an authority unto itself.”. I think he is referring to the fact that in order to obtain gold, it must be willfully relinquished, unless it is known to exist by a civil authority and confiscated.
Gold is many things to many people, which explains why it is so hard to analyze. To some, gold is a hedge against inflation, (perhaps not a good one, but perception plays a stronger part than reality). To others, gold is a hedge against deflation, (which perhaps explains why gold did so well for so long in a biflationary envrionment, even if it is dropping now). Read more