Skip to comments.In times of crisis, never forget the value of gold (William Rees-Mogg)
Posted on 02/15/2009 9:48:31 PM PST by TigerLikesRooster
In times of crisis, never forget the value of gold
The dollar is simply a piece of paper. Gold is a much better store of value and is the best insurance against future shocks
Last week was a bad one for bank shares; after the HBOS £8.5 billion loss, Lloyds shares fell by a third and other bank shares fell as well. Yet it was a very good week for the gold price, which closed on Friday at $935 an ounce, after reaching what was nearly a seven-month high of $953.30 on Wednesday.
Barclays Capital commented that gold prices were resuming their long-run bull trend after eight consecutive years of gains. For longer than the past eight years I have been arguing that investment in gold is an essential insurance against financial shocks. Last week was a classic example. Respectable British bank shares have now fallen by up to 90 per cent, while the gold price has risen by more than 200 per cent since Gordon Brown began selling the Bank of England's gold reserve.
I have been following the gold price since I published The Reigning Error, a short book on inflation, in 1974. I have not consistently advised people to buy gold - like all other assets, gold can become significantly overvalued, as it did in 1980. However, I have found that the movements of the gold price are one of the most useful pieces of evidence about the health of the world economy. Mr Brown's sale of gold was an avoidable error. My friend the MP Peter Tapsell repeatedly warned him in Parliament not to do it.
(Excerpt) Read more at timesonline.co.uk ...
Gold bashers won't like this comment.
Buying at the top of market is rarely a good investment. But buying today is better than buying yesterday, and having lost at least one percent of your investment.
If you’re really interested in hedging through metals, I’d personally suggest looking at platinum, which is half of it’s insane highs a year ago. Silver was very attractive just a week ago, now, it’s about 2/3’s of last year’s high’s. Vs gold which is 90% of last year’s high’s.
So how do I know gold isn’t in a bubble or overpriced right now?
"The Great Reckoning is an analysis of an event that is yet to happen--the final Depression of the 20th century. "
I think platinum is down due to decreased demand from the auto industry = catalytic converters use platinum.
Well, that was a timely read. I'm still stuck in stocks and gold may well be overpriced.
LOL. I read the book (which I still have) in 1991, I bought the Krugerrands in 1993.
Friday I bought old US silver (90%) dollars for $12.50 each.
That’s an incredible price, even for very rough ones.
Declare the private ownership of gold to be illegal, then take it away from the people who have "horded" it.
It's been done before.
We'll see monday how the markets react and then maybe there will be a reaction in the commodities market.
I told someone else earlier on FR and they had the same reaction.
That reaction prompted me to go and buy 48 more Friday. Some are pretty worn looking. Most are dated in the 1800's. I bought them here.
They are legal US money and recognizable by everyone.
My neighbor went with me when I bought them...he bought something called 'silver rounds' that had 99.999 % silver written on them. I asked him who wrote that on them and how many people would believe that in a crisis situation. (assay required?)
That's why I bought US dollars...no questions/doubts about their content.They'll be easy to exchange in reasonable amounts.
That’s very, very cheap for those. “Cull” SD’s (readable features but not in any kind of numismatic condition...but not “slicks”...which I have a pile of = just barely recognizable as SDs) are likely to be about $15-16 even at a coin show...where you can avoid sales tax. http://www.brokencc.com/bulkdollars.php best price I know of: $14.65
However, you can get 90% silver coins by buying circulated “junk” silver quarters and dimes & halves about a buck/oz cheaper. A $1K face value bag of junk silver (treated and priced as 715 tr oz) is about $11,389 (Amark.com) or 11,300 (golddealer.com) or 11,182 (apmex.com) tulving.com is also a highly reco’ed source. SD’s always command a premium, as do halves, but that’s about the smallest premium I’ve ever seen. Of course, you’re buying in much smaller qtys, so you’re getting an even “better” deal.
Junk silver is: 1: Very divisable 2: Never will require an assay (as might a 100 oz bar) 3: is sold at about the smallest premium over spot.
I have loads of silver of various forms: Mostly 90% US coins and many kilos of scrap sterling silver flatware. Haven’t bought much lately.
!!!Beware of counterfeit Chinese silver dollars!!! These have been showing up at coin shows in increased numbers. An easy test: drop them on a tabletop. Nothing rings like silver. All, repeat, ALL Chinese silver is fake. Unfortunately, pewter (=mostly lead) weighs very close to silver, and the Chinese have learned to silver plate pewter so it resembles silver’s weight. Won’t ring like silver, though, and you won’t hurt bad condition coins dropping them on a wooden tabletop.
Grrr... those Chinese are into every fakery available.
Thanks. Looks like I just got lucky on the buy. And, thanks too for the advice on the Chinese coins.