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All That Glitters: Why I’m Not Investing in Gold

10 points by revorad 16y ago

krmmalik 16y ago
I'm really no expert on this matter either, but i've been following Robert T Kiyosaki on this matter, and have been doing my own reading, and from what i understand should we hit another depression like economic scenario, precious metals will indeed have plenty of intrinsic value. The author of the article gives the example of his father losing money on the coins bought. I suspect (with respect) that his father's timing was off, but the strategy was probably correct. There are many conspiracy theories that also float around, some believable, some not so, but if there is some truth to them, then the reason for abandoning the gold standard has more to do with control of the masses as opposed to counter-inflationary reasons. As i said. This is just my understanding, and im certainly no expert on this matter by any means. Im stocking up on a little bit of silver anyhow. If anyone wants to see the YouTube video by Kiyosaki that got me inspired, let me know, i'll post it here.
illumin8 16y ago
This is yet another investor that doesn't understand the historical role of gold as a store of wealth, trying to explain why he hasn't participated in the last 10 years of price appreciation (or currency depreciation). The simple fact of the matter is that global currencies are being printed at an alarming rate, and that money printing has a direct and powerful effect on the price of gold. When you ask "are we in a gold bubble?" you should be asking what the fundamental reasons are that gold has increased in value so much over the last 10 years. If gold has increased in value because our currency is worth less, then what leads you to believe that it will suddenly lose value? Is our currency suddenly going to increase in value significantly? Does the government or federal reserve have any plan to stop printing money? Would the government want to take money out of circulation when the economic recovery is shaky at best? The price of gold reacts very strongly to money printing. For this reason, every investor should have some gold in their portfolio. Even if you only have 5, 10, or 20%, because gold reacts so strongly to inflationary pressures, it can carry your portfolio in times of inflation or financial crisis.
revolvingcur 16y ago
"I think gold is more likely to see $500 an ounce in the next decade than $5000 an ounce." As true as this probably is, it actually highlights the fact that there is money to be made by playing the precious metal markets. This article seems to be written from the perspective of the long-term investor, but plently of us have been trading gold for the last several years and making a killing. It helps the argument to clarify what timeline you're operating on, since a crash may be irrelevant if you can read the harbingers.

10 points by revorad 16y ago

I'm really no expert on this matter either, but i've been following Robert T Kiyosaki on this matter, and have been doing my own reading, and from what i understand should we hit another depression like economic scenario, precious metals will indeed have plenty of intrinsic value. The author of the article gives the example of his father losing money on the coins bought. I suspect (with respect) that his father's timing was off, but the strategy was probably correct. There are many conspiracy theories that also float around, some believable, some not so, but if there is some truth to them, then the reason for abandoning the gold standard has more to do with control of the masses as opposed to counter-inflationary reasons. As i said. This is just my understanding, and im certainly no expert on this matter by any means. Im stocking up on a little bit of silver anyhow. If anyone wants to see the YouTube video by Kiyosaki that got me inspired, let me know, i'll post it here.

illumin8 16y ago

This is yet another investor that doesn't understand the historical role of gold as a store of wealth, trying to explain why he hasn't participated in the last 10 years of price appreciation (or currency depreciation). The simple fact of the matter is that global currencies are being printed at an alarming rate, and that money printing has a direct and powerful effect on the price of gold. When you ask "are we in a gold bubble?" you should be asking what the fundamental reasons are that gold has increased in value so much over the last 10 years. If gold has increased in value because our currency is worth less, then what leads you to believe that it will suddenly lose value? Is our currency suddenly going to increase in value significantly? Does the government or federal reserve have any plan to stop printing money? Would the government want to take money out of circulation when the economic recovery is shaky at best? The price of gold reacts very strongly to money printing. For this reason, every investor should have some gold in their portfolio. Even if you only have 5, 10, or 20%, because gold reacts so strongly to inflationary pressures, it can carry your portfolio in times of inflation or financial crisis.

revolvingcur 16y ago

"I think gold is more likely to see $500 an ounce in the next decade than $5000 an ounce." As true as this probably is, it actually highlights the fact that there is money to be made by playing the precious metal markets. This article seems to be written from the perspective of the long-term investor, but plently of us have been trading gold for the last several years and making a killing. It helps the argument to clarify what timeline you're operating on, since a crash may be irrelevant if you can read the harbingers.