It's looking grim again. Is gold the would-be saviour?

It's looking grim again. Is gold the would-be saviour?

Author
Discussion

12gauge

1,274 posts

173 months

Friday 16th December 2011
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Mikeyboy said:
Nope, what you need is a tank. Then anyone in a black car with a supercharger is just easy meat.

As for Gold. Yes I think ultimately its better than a Euro or even a dollar but when it comes down to it it just looks good. It has no intrinsic value so perhaps investing in something practical would make sense if you really thinks its going to get very bad.
What you need is a skill.

Mechanics, pharmacy, bombmaking.

The whole point of gold is that when an electronic credit system breaks down and you need a doctor but only know a bombmaker but you are a mechanic and the doctor needs a bombmaker, you can use it as a practical unit of exchange.

lockhart flawse

2,040 posts

234 months

Friday 16th December 2011
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It's interesting that Buffet doesn't have any gold investments because it has no intrinsic value. My own view is that gold is a bubble that will collapse at some point. I have no idea when but these things usually go on longer than you might expect. A trend is a trend until it stops and I think that when gold does stop it will stop big time.

L.F. ( No position in gold.)

supersingle

3,205 posts

218 months

Friday 16th December 2011
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Governments, central banks and the City hate physical gold and expend great energy in ridiculing anyone who likes it.

Reason enough to own some.

supersingle

3,205 posts

218 months

Friday 16th December 2011
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lockhart flawse said:
It's interesting that Buffet doesn't have any gold investments because it has no intrinsic value. My own view is that gold is a bubble that will collapse at some point. I have no idea when but these things usually go on longer than you might expect. A trend is a trend until it stops and I think that when gold does stop it will stop big time.

L.F. ( No position in gold.)
Nothing in the world has any intrinsic value.

Value exists only in our minds.



98elise

26,376 posts

160 months

Saturday 17th December 2011
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supersingle said:
lockhart flawse said:
It's interesting that Buffet doesn't have any gold investments because it has no intrinsic value. My own view is that gold is a bubble that will collapse at some point. I have no idea when but these things usually go on longer than you might expect. A trend is a trend until it stops and I think that when gold does stop it will stop big time.

L.F. ( No position in gold.)
Nothing in the world has any intrinsic value.

Value exists only in our minds.
Quite right, value is only in the mind of the person who wants the goods or services of another.

Ultimately the only things you reallly need are food, water and shelter. If everything goes tits upon a global scale, see why a rare metal would be of any value.

Scooby72

679 posts

180 months

Saturday 17th December 2011
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98elise said:
When the st hits the fan a pile of gold will be useless.

What you need is guns and food......and maybe a black car with a supercharger smile
Agreed, all of that as well, except maybe the black car with the supercharger bit. ;-)

http://www.dailymail.co.uk/news/article-2075371/St...

I also keep approx 1 months wages in cash, where I can get at it, just in case the cashpoints shut down for a while.

If Europe and it's banks collapse next year, I don't think it's such a mad idea that cashpoints will stop working, and food will be cleared from supermarket shelves in a matter of a couple of days.







cymtriks

4,560 posts

244 months

Saturday 17th December 2011
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Interestingly compared to circa 1980:
  • Gold is not as expensive when inflation is included
  • Gold compared to the FTSE is way, way, lower
...and after that it went into a twenty year decline.

Oddly, and off topic, house prices are another interesting thing to correct for inflation. If you bought an average house in 1990 and sold it in 2001 you'd have made no money at all after inflation yet all through that time I heard nothing but claims that bricks and mortar was the best investment possible.

Oh, and again corrected for inflation, the FTSE was nudging 10000 in 2000 and 7500 in 2007. Now at 5-and-a-bit thousand.

anonymous-user

53 months

Sunday 18th December 2011
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Scooby72 said:
98elise said:
When the st hits the fan a pile of gold will be useless.

What you need is guns and food......and maybe a black car with a supercharger smile
Agreed, all of that as well, except maybe the black car with the supercharger bit. ;-)

http://www.dailymail.co.uk/news/article-2075371/St...

I also keep approx 1 months wages in cash, where I can get at it, just in case the cashpoints shut down for a while.

If Europe and it's banks collapse next year, I don't think it's such a mad idea that cashpoints will stop working, and food will be cleared from supermarket shelves in a matter of a couple of days.


So what will you do with the cash?

Scooby72

679 posts

180 months

Sunday 18th December 2011
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REALIST123 said:
Scooby72 said:
98elise said:
When the st hits the fan a pile of gold will be useless.

What you need is guns and food......and maybe a black car with a supercharger smile
Agreed, all of that as well, except maybe the black car with the supercharger bit. ;-)

http://www.dailymail.co.uk/news/article-2075371/St...

I also keep approx 1 months wages in cash, where I can get at it, just in case the cashpoints shut down for a while.

If Europe and it's banks collapse next year, I don't think it's such a mad idea that cashpoints will stop working, and food will be cleared from supermarket shelves in a matter of a couple of days.


So what will you do with the cash?



That's a good question, I guess I'd just rather have it than not have it, and it could be handy if te cashpoints closed just for a day or two.

Kudos

2,672 posts

173 months

Sunday 18th December 2011
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Scooby72 said:
I also keep approx 1 months wages in cash, where I can get at it, just in case the cashpoints shut down for a while.

If Europe and it's banks collapse next year, I don't think it's such a mad idea that cashpoints will stop working, and food will be cleared from supermarket shelves in a matter of a couple of days.
I think you watch too much TV

12gauge

1,274 posts

173 months

Sunday 18th December 2011
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supersingle said:
Nothing in the world has any intrinsic value.

Value exists only in our minds.
You know what he means. No yield, no rent seeking usage or i guess definable utility value.

supersingle

3,205 posts

218 months

Sunday 18th December 2011
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12gauge said:
You know what he means. No yield, no rent seeking usage or i guess definable utility value.
No counterparty risk! smile

DonkeyApple

54,927 posts

168 months

Sunday 18th December 2011
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supersingle said:
No counterparty risk! smile
Really?

Unless you pay the massive premium to self store and also take the massive hit when selling gold that has not been held in recolonized storage you will certainly have counterparty risk.

It's an unregulated market, firstly this means that the firms holding will rarely be doing so segregated, it will be none seg with title so you are totally exposed to the security of that firm with no control over what other business they are using their inflated balance sheets for and secondly you are outside any govt protection scheme.

And that's assuming it's not a ponzi scheme in the first place which if gold pulls back we will discover quite a few to be. biggrin

supersingle

3,205 posts

218 months

Sunday 18th December 2011
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DonkeyApple said:
Really?

Unless you pay the massive premium to self store and also take the massive hit when selling gold that has not been held in recolonized storage you will certainly have counterparty risk.

It's an unregulated market, firstly this means that the firms holding will rarely be doing so segregated, it will be none seg with title so you are totally exposed to the security of that firm with no control over what other business they are using their inflated balance sheets for and secondly you are outside any govt protection scheme.

And that's assuming it's not a ponzi
scheme in the first place which if gold pulls back we will discover quite a few to be. biggrin
You're talking about serious investors who probably buy tons of the stuff.

I'm talking about ordinary people who've been reamed by the banking system and wish to hold a little wealth where nobody else can get hold of it.



DonkeyApple

54,927 posts

168 months

Sunday 18th December 2011
quotequote all
supersingle said:
DonkeyApple said:
Really?

Unless you pay the massive premium to self store and also take the massive hit when selling gold that has not been held in recolonized storage you will certainly have counterparty risk.

It's an unregulated market, firstly this means that the firms holding will rarely be doing so segregated, it will be none seg with title so you are totally exposed to the security of that firm with no control over what other business they are using their inflated balance sheets for and secondly you are outside any govt protection scheme.

And that's assuming it's not a ponzi
scheme in the first place which if gold pulls back we will discover quite a few to be. biggrin
You're talking about serious investors who probably buy tons of the stuff.

I'm talking about ordinary people who've been reamed by the banking system and wish to hold a little wealth where nobody else can get hold of it.
But then your costs are even worse.

Selling physical gold to retail punters is the biggest scam since the clamped down on all the penny share and IPO scams.

Taking physical delivery is bad for starters as the retail punter pays way over the odds for the weight of gold in the first instance, putting them instantly off side with up to a 20% loss in many instances. Then, when you come to sell you face anything up to a 20%-50% discount for having held it as physical, in most cases you are talking about trading at scrap metal prices.

If people want a lump of gold to have their mantel piece to show visitors how wealthy they are then fine but it isn't an investment and nor is it really ever going to be a purchasing tool in this country.

All gold is is the latest scam product that is shiny and easy to con people out of their savings. Just look at the publications and authors promoting it, they are all the old penny share peddlers or fine wine or land bank scrotes. There is an entire army of shysters and turds solely intent on mugging people and gold is just one of the many tools in their arsenal.

supersingle

3,205 posts

218 months

Sunday 18th December 2011
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You don't know what you're talking about. You can buy physical gold in small quantities (coins or small bars) from a High St gold retailer for one or two percent above spot price. When you come to sell the spread is the same. So you're looking at a 2 to 4% transaction cost.

No use if you fancy yourself as some sort of city day trader, but perfectly acceptable and transparent for most mortal folk.

What do you have against ordinary people owning a little physical gold away from the clutches of the financial system. Do you work in the City or something?

Victor McDade

4,395 posts

181 months

Sunday 18th December 2011
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DonkeyApple said:
Taking physical delivery is bad for starters as the retail punter pays way over the odds for the weight of gold in the first instance, putting them instantly off side with up to a 20% loss in many instances. Then, when you come to sell you face anything up to a 20%-50% discount for having held it as physical, in most cases you are talking about trading at scrap metal prices.
Not quite true.

You can buy one ounce gold Krugerrands for a 3-5% premium from dealers and they will buy back for around the same percentage below spot price. I've done this several times over the past 5 years without any issues at all. So yes, you're looking at a 6-10% loss to make up as soon as you take possession but the numbers are not quite as bad as you are suggesting.

Scooby72

679 posts

180 months

Sunday 18th December 2011
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Kudos said:
Scooby72 said:
I also keep approx 1 months wages in cash, where I can get at it, just in case the cashpoints shut down for a while.

If Europe and it's banks collapse next year, I don't think it's such a mad idea that cashpoints will stop working, and food will be cleared from supermarket shelves in a matter of a couple of days.
I think you watch too much TV
Lets hope you're right !!

If it doesn't happen it will make no difference to me. But if it does you might end up feeling a bit silly.

supersingle

3,205 posts

218 months

Sunday 18th December 2011
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Victor McDade said:
Not quite true.

You can buy one ounce gold Krugerrands for a 3-5% premium from dealers and they will buy back for around the same percentage below spot price. I've done this several times over the past 5 years without any issues at all. So yes, you're looking at a 6-10% loss to make up as soon as you take possession but the numbers are not quite as bad as you are suggesting.
That sort of spread will get you nice, shiny, newly minted 1oz coins. You'll pay less for battered old bullion coins, although you might get less when you come to sell as well.

DonkeyApple

54,927 posts

168 months

Sunday 18th December 2011
quotequote all
supersingle said:
You don't know what you're talking about. You can buy physical gold in small quantities (coins or small bars) from a High St gold retailer for one or two percent above spot price. When you come to sell the spread is the same. So you're looking at a 2 to 4% transaction cost.

No use if you fancy yourself as some sort of city day trader, but perfectly acceptable and transparent for most mortal folk.

What do you have against ordinary people owning a little physical gold away from the clutches of the financial system. Do you work in the City or something?
I've nothing against people doing what they want, but I've spent nearly 20 years in an industry beset by spank shops peddling their wares to dumb investors and I'm afraid gold is very much one of these products.

You only have to see the links people on this forum are putting up to what they think are articles written by credible people when in fact most of them are advertorials commissioned by well known individuals with a very strong track record. It is a turd of an industry and I see poor mugs sleep walking into it and falling for the hype and lies and wasting their money most days.

If my posts make one person open their eyes a bit more and question what they are doing and why then I am pleased.

Afterall, what actual use is physical gold? Seriously, what use does it have in our society?

And re the costs, most people are not paying anywhere near those rates. And as for jewellers, how do you think they will price the gold in market conditions when people actually need to cash it in? wink

The whole silly farce about gold is that if you ever genuinely needed to use it because of social issues then it will have next to no value in comparison to what it is being sold for today. Every major event in recent history which has led to an exodus of people or a need for gold as some form of primative currency has proven this.

As I mentioned in a previous thread, what do you think English jewellers were offering to Jewish imigrants in the late 30s?

Sure, have some gold for fun but it's foolish to think it actually has any significant value close to what you will be paying for it if it ever came to needing it as some form of currency.

People just aren't thinking straight.