Posted on 02/03/2016 9:10:05 AM PST by blam
Jared Dillian, Mauldin Economics
January 3, 2016
Long before I started writing for Mauldin Economics, I was a gold bull.
A mega-gold bull.
This started in 2005. I was making markets in ETFs at the time and—as head of the ETF desk at Lehman Brothers—I signed the firm up to be one of the early authorized participants in the SPDR Gold Shares fund (GLD).
I was pretty excited.
It may seem quaint now, but at the time there really wasn’t an easy way to invest in gold outside of coins or bars (high transaction costs, cumbersome) or futures (high barriers to entry). Physical gold, of course, is preferable, but you can’t really trade it, per se.
So I bought some GLD in 2005, bought more, bought more, bought more in 2008 with veins popping out of my neck, and was caught massively long in 2011.
I figured, oh well, it’s just a correction, I’ll ride it out. Except I didn’t know that it was going to be a 40+% drawdown and last five years. If I’d had that knowledge, I probably would have sold.
But my investment thesis on gold hadn’t changed.
Let me explain.
(snip)
(Excerpt) Read more at businessinsider.com ...
It does help the economy of the person who makes the commission from selling you gold I guess. Same for everything else.
Because you can eat it?
If you hoard gold, when the sh@t hits the fan, people with guns will take your gold, and everything else you may have hoarded.
"Aqua regia was so named because it can dissolve the noble metals gold and platinum."
I have enough gold to stuff in my pockets. That’s as much as I intend to buy.(about 15,000 worth)
People I know bought gold as insurance and they also have lots of guns and ammo. They bought gold after they had the guns & ammo.
So, like the Texans and their cannon, Come And Take It
Gold is just like stocks. Buy low and sell high. NUGT was up 12% today, I sold. When it drops I’ll buy back in.
If you don’t prepare, you and your loved ones will starve.
Preparation has hundreds of components and one of them is getting hold of real money.
When they're right, they're very, very right. But, usually they're wrong.
And, if the S truly does HTF .... What are the hoarders going to do with gold? Wander down to the local mini-mart, and use a couple of bars to pick up a pack of smokes and a Dr. Pepper? How would they get change? Why wouldn't they just get shot (sooner-or-later) for their troubles? Flashing gold around seems like a good way to leave a lasting impression.
If they were really, really serious about hoarding, I could see where one would make the case for junk silver. Portable, usable, and fungible, and bound not to attract too much attention.
Real money would be useful commodities, and guns and ammo.
Right, first store up food, water and blankets.
If the SHTF, protecting your little hoard of gold will be the least of your worries. In a barter situation, I don’t want your gold, I want something of immediately use and practical value. A pound of lead, a hundred shell casings, antibiotics, or cooking oil will be worth more than its equivalent weight in gold.
Exactly, and coffee, soap and tobacco would buy you a lot more than gold would.
If SHTF, silver would be much more useful to trade. Sure, guns, ammo, matches, batteries, etc...would be easier to trade, but eventually some form of currency will form and it’s a lot easier using silver than gold.
Toilet paper!
They’d better bring their “A” game...
DO NOT buy ETF’s. Buy physical gold and silver.
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