Comments on: Why I don’t like gold as an investment http://advancedpersonalfinance.com/why-i-dont-like-gold-as-an-investment/ Moving beyond the basics Thu, 04 Dec 2008 07:20:21 +0000 http://wordpress.org/?v=2.2.2 By: RealityBytes http://advancedpersonalfinance.com/why-i-dont-like-gold-as-an-investment/#comment-21942 RealityBytes Tue, 25 Mar 2008 01:40:04 +0000 http://advancedpersonalfinance.com/why-i-dont-like-gold-as-an-investment/#comment-21942 Good post. Thank you for a decent analysis. I am very happy to find a well thought out view against gold. It’s not the hedge people claim 1. Gold is good for times of financial uncertainty. Look at it's performance around 9/11. It might not be directly correlated with inflation, unless it's runaway inflation. If the Fed keeps pumping liquidity into the system, that very may well be our fate. Are we not in or heading toward a period of stagflation? Gold isn’t the ‘ultimate currency’ 2. Paper currency is no longer backed by gold. Therefore it's value can return to zero. Without a limiting factor on the amount of money the FED can print, there is nothing reigning in the liquidity party train. Without a tangible asset to back the value of currency it can lose it's true value. Gold is a commodity that is rare and therefore historically valuable. In times of financial turmoil, internationally, gold returns to prominence as a store of wealth. True enough, all commodities will do well, at least for the near future. 3. Gold as investment has unfavorable tax treatment Didn't know that. Thank you. 4. There decent options for securing gold. http://www.goldmoney.com is an excellent way. Kitco has storage (for a small fee). IMHO we are in a long term bull market for gold. There are a number of other factors that will aid the price of gold, in the short and long term. 1. The dropping value of the US dollar. 2. Foreign ownership of debt 3. The ballooning deficit. We can't inflate it away forever. 4. Subprime. Deflation of the housing bubble. 5. The stock market is over inflated in my opinion. 6. Baby boomer retirement. Would be very happy to hear your thoughts. Good post. Thank you for a decent analysis. I am very happy to find a well thought out view against gold.

It’s not the hedge people claim
1. Gold is good for times of financial uncertainty. Look at it’s performance around 9/11. It might not be directly correlated with inflation, unless it’s runaway inflation. If the Fed keeps pumping liquidity into the system, that very may well be our fate. Are we not in or heading toward a period of stagflation?

Gold isn’t the ‘ultimate currency’
2. Paper currency is no longer backed by gold. Therefore it’s value can return to zero. Without a limiting factor on the amount of money the FED can print, there is nothing reigning in the liquidity party train. Without a tangible asset to back the value of currency it can lose it’s true value. Gold is a commodity that is rare and therefore historically valuable. In times of financial turmoil, internationally, gold returns to prominence as a store of wealth. True enough, all commodities will do well, at least for the near future.

3. Gold as investment has unfavorable tax treatment
Didn’t know that. Thank you.

4. There decent options for securing gold.

http://www.goldmoney.com is an excellent way. Kitco has storage (for a small fee).

IMHO we are in a long term bull market for gold. There are a number of other factors that will aid the price of gold, in the short and long term.

1. The dropping value of the US dollar.

2. Foreign ownership of debt

3. The ballooning deficit. We can’t inflate it away forever.

4. Subprime. Deflation of the housing bubble.

5. The stock market is over inflated in my opinion.

6. Baby boomer retirement.

Would be very happy to hear your thoughts.

]]> By: Mrs. Micah http://advancedpersonalfinance.com/why-i-dont-like-gold-as-an-investment/#comment-20184 Mrs. Micah Mon, 10 Mar 2008 19:41:01 +0000 http://advancedpersonalfinance.com/why-i-dont-like-gold-as-an-investment/#comment-20184 Gold is one of my biggest personal finance pet peeves. Just because it's been around for so long doesn't make it everlasting. Only stupid people will take it in crisis situations where staying alive is a priority. It's only useful when things are stable or will stabilize again (plus, how do you store it when there's a crisis?). Gold is one of my biggest personal finance pet peeves. Just because it’s been around for so long doesn’t make it everlasting. Only stupid people will take it in crisis situations where staying alive is a priority. It’s only useful when things are stable or will stabilize again (plus, how do you store it when there’s a crisis?).

]]> By: Danny Tsang http://advancedpersonalfinance.com/why-i-dont-like-gold-as-an-investment/#comment-20183 Danny Tsang Mon, 10 Mar 2008 18:23:18 +0000 http://advancedpersonalfinance.com/why-i-dont-like-gold-as-an-investment/#comment-20183 I'm with you on this. When it comes down to it, what can you do with gold? If stuff hits the fan and we're in chaos, you can't eat gold, you can't use gold to heat your house or power a vehicle. How in the world is gold valuable besides the fact that it's shiny and you can make a pretty necklace for your girlfriend with it? Thats why I never liked gold as an investment either. It seems like a bubble to me. People talk it all up but its "overvalued" since there is no justification for it's increase in price. I’m with you on this. When it comes down to it, what can you do with gold? If stuff hits the fan and we’re in chaos, you can’t eat gold, you can’t use gold to heat your house or power a vehicle. How in the world is gold valuable besides the fact that it’s shiny and you can make a pretty necklace for your girlfriend with it?

Thats why I never liked gold as an investment either. It seems like a bubble to me. People talk it all up but its “overvalued” since there is no justification for it’s increase in price.

]]> By: aa http://advancedpersonalfinance.com/why-i-dont-like-gold-as-an-investment/#comment-20179 aa Mon, 10 Mar 2008 14:02:15 +0000 http://advancedpersonalfinance.com/why-i-dont-like-gold-as-an-investment/#comment-20179 Be diversified with a basket of commodities: gold, silver, oil, wheat, etc. Be diversified with a basket of commodities: gold, silver, oil, wheat, etc.

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