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In times of crisis, never forget the value of gold (William Rees-Mogg)
The Times(UK) ^ | 02/16/09 | 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

William Rees-Mogg

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 ...


TOPICS: Business/Economy; News/Current Events
KEYWORDS: dollar; gold; reesmogg
The dollar is simply a piece of paper. Gold is a much better store of value and is the best insurance against future shocks

Gold bashers won't like this comment.

1 posted on 02/15/2009 9:48:31 PM PST by TigerLikesRooster
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To: TigerLikesRooster; PAR35; AndyJackson; Thane_Banquo; nicksaunt; MadLibDisease; happygrl; ...

Ping!


2 posted on 02/15/2009 9:48:58 PM PST by TigerLikesRooster (kim jong-il, chia head, ppogri, In Grim Reaper we trust)
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To: TigerLikesRooster

http://www.24hgold.com/english/contributor.aspx?contributor=investing%20in%20precious%20metals&article=1678113448G10020


3 posted on 02/15/2009 9:55:42 PM PST by djf
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To: TigerLikesRooster

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.


4 posted on 02/15/2009 10:02:24 PM PST by kingu (Party for rent - conservative opinions not required.)
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To: kingu

So how do I know gold isn’t in a bubble or overpriced right now?


5 posted on 02/15/2009 10:06:33 PM PST by umgud (I'm really happy I wasn't aborted)
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To: TigerLikesRooster
Blood in the Streets - by James Dale Davidson (Author), William Rees-Mogg (Author)
6 posted on 02/15/2009 10:09:40 PM PST by Stentor
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To: TigerLikesRooster
I bought this book, The Great Reckoning: How The World Will Change In The Depression Of The 1990s, written by Rees-Moog and James Davidson in 1991. After I read it, I was prompted to buy krugerrands at $382.00 each, which I still have.

"The Great Reckoning is an analysis of an event that is yet to happen--the final Depression of the 20th century. "

7 posted on 02/15/2009 10:12:05 PM PST by blam
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To: kingu

I think platinum is down due to decreased demand from the auto industry = catalytic converters use platinum.


8 posted on 02/15/2009 10:15:24 PM PST by blam
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To: TigerLikesRooster
Check this out....

Gold for food
9 posted on 02/15/2009 10:16:46 PM PST by Kozak (USA 7/4/1776 to 1/20/2009 Requiescat In Pace)
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To: blam
After I read it, I was prompted to buy krugerrands at $382.00 each

Well, that was a timely read. I'm still stuck in stocks and gold may well be overpriced.

10 posted on 02/15/2009 10:25:22 PM PST by TheThinker (Shame and guilt mongering is the Left's favorite tool of control.)
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To: TheThinker
"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.

11 posted on 02/15/2009 10:29:50 PM PST by blam
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To: blam

That’s an incredible price, even for very rough ones.


12 posted on 02/15/2009 10:34:04 PM PST by Attention Surplus Disorder (Mr. Bernanke, have you started working on your book about the second GREATER depression?")
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To: TigerLikesRooster
Simple enough.

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.

13 posted on 02/15/2009 10:37:03 PM PST by E. Pluribus Unum ("Only after disaster can we be resurrected." -- Tyler Durden)
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To: blam
I was thinking of buying old silver dollars also and now may be the time. I just can't get my wife to go along with the idea that things are going to get worse and metals are going to rise.

We'll see monday how the markets react and then maybe there will be a reaction in the commodities market.

14 posted on 02/15/2009 10:38:55 PM PST by TheThinker (Shame and guilt mongering is the Left's favorite tool of control.)
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To: Attention Surplus Disorder
"That’s an incredible price, even for very rough ones."

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.

15 posted on 02/15/2009 10:39:41 PM PST by blam
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To: TheThinker
"I was thinking of buying old silver dollars also and now may be the time. I just can't get my wife to go along with the idea that things are going to get worse and metals are going to rise. "

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.

16 posted on 02/15/2009 10:48:22 PM PST by blam
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To: blam

Good advice.


17 posted on 02/15/2009 10:51:12 PM PST by TheThinker (Shame and guilt mongering is the Left's favorite tool of control.)
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To: blam

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.


18 posted on 02/15/2009 11:03:01 PM PST by Attention Surplus Disorder (Mr. Bernanke, have you started working on your book about the second GREATER depression?")
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To: Attention Surplus Disorder
!!!Beware of counterfeit Chinese silver dollars!!!

Grrr... those Chinese are into every fakery available.

19 posted on 02/15/2009 11:09:29 PM PST by TigerLikesRooster (kim jong-il, chia head, ppogri, In Grim Reaper we trust)
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To: Attention Surplus Disorder
"That’s very, very cheap for those."

Thanks. Looks like I just got lucky on the buy. And, thanks too for the advice on the Chinese coins.

20 posted on 02/15/2009 11:09:47 PM PST by blam
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To: TigerLikesRooster

“!!!Beware of counterfeit Chinese silver dollars!!!
Grrr... those Chinese are into every fakery available.”

The abacus was invented in China thousands of years ago, but I suspect fraud was introduced into transactions about 35 minutes later, LOL.


21 posted on 02/15/2009 11:15:57 PM PST by Attention Surplus Disorder (Mr. Bernanke, have you started working on your book about the second GREATER depression?")
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To: blam

http://coinauctionshelp.com/Counterfeit_Silver_Dollars_Fake_Trade_Dollars_Fake_Morgan_Dollar.html

Google “Counterfeit Chinese silver dollars” or “Counterfeit trade dollars” or “Fake Chinese silver/trade dollars”....you’ll find plenty of info.

There have pix on the net of factories in China with huge bins of fake coins. It’s alarming, to say the least.


22 posted on 02/15/2009 11:18:30 PM PST by Attention Surplus Disorder (Mr. Bernanke, have you started working on your book about the second GREATER depression?")
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To: Attention Surplus Disorder

An airstrike should be launched on those factories...


23 posted on 02/15/2009 11:45:31 PM PST by Axenolith (Government blows, and that which governs least, blows least...)
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To: TigerLikesRooster

Gold is overpriced as it is now.


24 posted on 02/15/2009 11:51:14 PM PST by Force of Truth (Sarah Palin in 2012!!!!!! WOOOHOOOOO!!!!!!!!!)
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To: TigerLikesRooster
Rev 6:1-6
Now I watched when the Lamb opened one of the seven seals, and I heard one of the four living creatures say with a voice like thunder, "Come!" And I looked, and behold, a white horse! And its rider had a bow, and a crown was given to him, and he came out conquering, and to conquer. When he opened the second seal, I heard the second living creature say, "Come!"

And out came another horse, bright red. Its rider was permitted to take peace from the earth, so that men should slay one another, and he was given a great sword. When he opened the third seal, I heard the third living creature say, "Come!" And I looked, and behold, a black horse! And its rider had a pair of scales in his hand. And I heard what seemed to be a voice in the midst of the four living creatures, saying, "A quart of wheat for a denarius, and three quarts of barley for a denarius, and do not harm the oil and wine!"


25 posted on 02/16/2009 12:29:40 AM PST by Force of Truth (Sarah Palin in 2012!!!!!! WOOOHOOOOO!!!!!!!!!)
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To: blam

Good price...Where did u get them?


26 posted on 02/16/2009 1:02:57 AM PST by M-cubed (Why is "Greshams Law" a law?)
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To: blam

“The Great Reckoning” changed my thinking about a lot of things. A great book. I read it in 1992 a few times since then


27 posted on 02/16/2009 1:17:42 AM PST by dennisw (Archimedes--- Give me a place to stand, and I will move the Earth)
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To: Attention Surplus Disorder

Apmex was selling, as of late last week, rolls of 20 “war nickels” for just a tad under spot price of silver. Each roll of 20 Jefferson war nickels has 1.125 oz pure silver. The coins are 35% silver, the remainder nickel. Cheapest US Mint silver I’ve seen anywhere. If (when) TSHTF, these would make great silver denominated coins for small purchases/barters. 0.0563 Oz silver per coin.


28 posted on 02/16/2009 2:16:38 AM PST by jsh3180
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To: E. Pluribus Unum
Declare the private ownership of gold to be illegal, then take it away from the people who have "horded" it.

Correct me if I'm wrong, but I've been under the impression that "seized" gold was compensated at price that was above market at the time, something like $35.00/oz.?

29 posted on 02/16/2009 3:35:41 AM PST by RegulatorCountry
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To: E. Pluribus Unum
Simple enough. 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.

By the time they try that, millions of people will be hungry and afraid. They will have to take the guns at the same time in order to take the gold. IOW, they will risk igniting a dirty civil war if they try.

30 posted on 02/16/2009 4:11:57 AM PST by Travis McGee (www.EnemiesForeignAndDomestic.com)
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To: RegulatorCountry

Gold was “reimbursed” at 20 dollars and ounce, then FDR turned around and revalued it at 35 an ounce, instantly ripping off everyone who turned in their gold.


31 posted on 02/16/2009 4:13:35 AM PST by Travis McGee (www.EnemiesForeignAndDomestic.com)
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To: E. Pluribus Unum
Declare the private ownership of gold to be illegal, then take it away from the people who have "horded" it.

I would imagine that there would be a great deal of employee turnover in the "Taker" positions!

32 posted on 02/16/2009 4:24:53 AM PST by ExSES (the "bottom-line")
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To: RegulatorCountry
A bit before my time but I believe you were allowed to own one ounce of gold at a time. Thank you, FDR. If you were in possession of more than one ounce, it was confiscated WITHOUT COMPENSATION!
By collecting all the gold and putting it into the Reserve, FDR could print more money. A mere formality not bothered with today. By calling in all the gold, changing the monetary notes from gold-backed to new, silver backed ones,instituting federal income tax collection, and ID-ing us all with Social Security Numbers, FDR could track every dime and its owner in the USA.
There is no refuge from the Socialism that is coming. Not gold, not foreign banks, not property, not hiding it under the bed. Other than taking the fight to the streets when they come for your rights, all is lost... And with 60% of the country already willing to wear uniforms with pretty red stars on the hats, well, we can go down trying,I guess.
I see reeducation camps in the future for many of us on Free Republic.
33 posted on 02/16/2009 4:28:57 AM PST by ArtDodger (Re-read Animal Farm (with your kids))
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To: TigerLikesRooster
In a depression, gold should be going down with other commodities - it's not because of the underlying financial chaos.

Going to cash now includes putting actual cash in a safe deposit box. What is going on?

34 posted on 02/16/2009 5:07:54 AM PST by GOPJ (What's caused 19 deaths, makes travel difficult, and won't melt til April? Global Warming.FR:Dentist)
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To: GOPJ

Many fear that, down the road, all those bailout money eventually come back to create hyperinflation(via catastrophic devaluation/sovereign default.)


35 posted on 02/16/2009 5:18:42 AM PST by TigerLikesRooster (kim jong-il, chia head, ppogri, In Grim Reaper we trust)
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To: M-cubed
"Good price...Where did u get them?"

Here

36 posted on 02/16/2009 5:19:50 AM PST by blam
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To: TigerLikesRooster
Many fear that, down the road, all thosebailout money eventually come back to create hyperinflation (via catastrophic devaluation/sovereign default.)

Yep. And I'm one of those people...

37 posted on 02/16/2009 5:32:02 AM PST by GOPJ (What's caused 19 deaths, makes travel difficult, and won't melt til April? Global Warming.FR:Dentist)
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To: TigerLikesRooster

ARTICLE 1 SECTION 8, US COMSTITUTION:

No State shall make anything but gold and silver COIN a payment of debt.


38 posted on 02/16/2009 7:42:05 AM PST by Chewbacca (Buy gold and silver coins to profit from the comming dollar melt down!)
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To: E. Pluribus Unum

“Declare the private ownership of gold to be illegal, then take it away from the people who have “horded” it. “

You would cause the instant rebellion of millions of women and married couples that would refuse to turn over their jewelry and wedding rings to the government.


39 posted on 02/16/2009 7:45:43 AM PST by Chewbacca (Buy gold and silver coins to profit from the comming dollar melt down!)
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To: jsh3180

You’re right, the Ag content of war nickels is the highest multiple over face of any US coin: about 15x face vs 10x face for dimes, Q’s, H’s. But; I’d suggest they won’t be highly desirable as silver “fractions” because the fraction of silver is so low and the sheer logistics of any quantity of these things. (I’m not using the word “never”!) Which is reflected now and will be reflected “then” in the market price. Just my opinion. After all...imagine if I had a 17.3 lb block of steel which had 1 oz of pure Ag within it, totally assayed. How many of those would you want to drag around/store? Semi-ridiculous example, I admit. Point being: There is a good reason why the premiums are low on less desirable forms. Just a thinking point.

This is also illustrated by the dynamics of the sterling silver I’ve gathered over the years. Sterling, nominally 92.5% Ag, is really taken as 91% by refiners, you have to ship it to them, a cost that rises and rises over time and you had better insure it...last shipment I made was $9 freight and $16 insurance...they will give you (typ) 88% of the recovered metal vs 90% on junk silver even though the tare weight Ag content is higher on .925; they will extract 1-2% for “the pot”; they will decide which of the seven days they held your goods for processing will be the day your price is established, and golly gee, that will be the lowest 30-minute price established in the spot market that week.

http://www.midwestrefineries.com/

Note also; that as the price of Ag rises, since the various processing fees are “percentages of spot”...the higher the proc costs are. It’s a weird game. I don’t underestimate for one minute the hassles of maintaining and fueling a 2000+ degree furnace and an assay lab and dealing with fumes and fire regs and I’ll certainly not have same in my garage or back yard. But sterling silver only yields 80% of its actual weight.


40 posted on 02/16/2009 10:58:48 AM PST by Attention Surplus Disorder (Mr. Bernanke, have you started working on your book about the second GREATER depression?")
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To: TigerLikesRooster

....The dollar is simply a piece of paper....

More precisely, the $$$ is but an electronic blip on a hard drive. The paper is a representation of that blip that enables off ledger transfers.

Gold is a refuge. Some may seek comfort and return to gold by trading blips for the age old standard


41 posted on 02/16/2009 11:04:04 AM PST by bert (K.E. N.P. +12 . The original point of America was not to be Europe)
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To: umgud

“So how do I know gold isn’t in a bubble or overpriced right now?”

Answer this question to yourself — Do you believe a bankrupt government would resort to the printing press to prop up the illusion of a functioning economy as long as possible and postpone the day or reckoning? Would a desperate government attempt to pay down debt using new money that cost nothing but ink? If you think so, then know that gold will reach astronomical heights in inverse relation to the dollar’s value.

The government will run the printing presses night and day to inject new money into the economy. The dollar’s value will be diluted unto worthlessness. Think of the Weimar Republic or Zimbabwe.

Debasement of money is a favorite tactic that goes back thousands of years — don’t you believe the current corrupt politicians are above doing it.


42 posted on 02/16/2009 12:29:29 PM PST by TexasRepublic (I am inconsolate over the death of our country.)
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To: blam

Hi: I went to website but could not figure out which old silver ones were priced at $12.50. I am a precious metals newbie. Any assistance would be appreciated. Thanks!


43 posted on 02/16/2009 6:50:01 PM PST by bushwon
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To: TigerLikesRooster
Most ordinary people can't afford to buy gold or silver in substantial amounts.

Fearing the worst, stocking up on goods that can be "bartered" is advised.

Think small bottles of Bourbon...etc. The street value on booze should be good for gold or food.

sw

44 posted on 02/16/2009 6:58:25 PM PST by spectre (sw)
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To: bushwon
"Hi: I went to website but could not figure out which old silver ones were priced at $12.50. I am a precious metals newbie. Any assistance would be appreciated. Thanks!"

LOL. I can't use the web site either. I just go to the store to look around.

45 posted on 02/16/2009 7:56:20 PM PST by blam
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To: spectre
"Fearing the worst, stocking up on goods that can be "bartered" is advised."

Coffee, chocolate and probably sugar will eventualy be good ones to barter too.

46 posted on 02/16/2009 7:58:06 PM PST by blam
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To: TigerLikesRooster

Gold bashers won’t like this comment.

There are no dividends, but at least it doesn’t evaporate like my mutual funds have the last few months.


47 posted on 02/17/2009 11:05:13 AM PST by chainsaw (The Democrat Party = The Party of Corruption.)
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To: TexasRepublic

new money that cost nothing but ink?

That’s the expensive way. Today they just keep pushing the Zero key on the computer. It’s,much faster, and cheaper.


48 posted on 02/17/2009 11:10:08 AM PST by chainsaw (The Democrat Party = The Party of Corruption.)
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To: blam

Friday I bought old US silver (90%) dollars for $12.50 each.

Go to the http://catalog.usmint.gov/webapp/wcs/stores/servlet/CategoryDisplay?catalogId=10001&storeId=10001&categoryId=13238&langId=-1&parent_category_rn=10191&top_category=10191 and buy your silver in the bag.


49 posted on 02/17/2009 11:15:50 AM PST by chainsaw (The Democrat Party = The Party of Corruption.)
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