Discussion
I’ve just finished reading How to Own the World by Andrew Craig, and he is very keen on owning precious metals, especially gold. He recommends owning physical gold via something like BullionVault rather than via an ETF or similar.
Has anyone done this, and can share their experiences? The fact that it’s outside an ISA would make CGT an issue; does BullionVault provide helpful reports to make declaring profits easy?
Also, I can’t help feeling that gold is now a missed opportunity. Looking at the all-time gold price, the pattern of the last four decades has been a surge in the seventies followed by twenty years of doldrums between 1980 and 2000, then a surge during the 2000s until 2012, and now it looks to me like it’s back in the doldrums (with lots of volatility).
Are we now approaching a post-QE era with rising interest rates and falling inflation, making gold less attractive? The latest edition of Andrew Craig’s book is now 2 years old; is his enthusiasm for gold looking a bit out-of-date?
Perhaps gold still has a place in a diversified portfolio to guard against another 2008-style equity crash. What do people think?
Has anyone done this, and can share their experiences? The fact that it’s outside an ISA would make CGT an issue; does BullionVault provide helpful reports to make declaring profits easy?
Also, I can’t help feeling that gold is now a missed opportunity. Looking at the all-time gold price, the pattern of the last four decades has been a surge in the seventies followed by twenty years of doldrums between 1980 and 2000, then a surge during the 2000s until 2012, and now it looks to me like it’s back in the doldrums (with lots of volatility).
Are we now approaching a post-QE era with rising interest rates and falling inflation, making gold less attractive? The latest edition of Andrew Craig’s book is now 2 years old; is his enthusiasm for gold looking a bit out-of-date?
Perhaps gold still has a place in a diversified portfolio to guard against another 2008-style equity crash. What do people think?
There is a big thread on PH about gold being our saviour.
Paul Tustain of BV is a good person and as gold is an unregulated instrument the market is mostly comprised of thieves and scam artists so you need to pick the forms you work with very carefully.
Is gold worth holding? No. Not for the vast majority. Most people who get involved with gold do so because it’s gold coloured and shiny or because they are old and scared that the world is going to end now that their children are running it not because they actually make any money.
Gold was the big scam sell in the long list of scam products before binary betting and now bitcoin. Millions of people were duped into buying various gold products, many of which where the gold never existed, from late 2009. But it’s been the only physical asset to not rise since about 2010/11.
There is no real reason to hold gold other than if you think you may need to cross a border quickly or if you think the world is definitely going to end unless you are arguably in the top global 1% then it becomes a diversity/hedge play.
It has no yield. It cost money to store. It’s unregulated. Has large spreads. When the market falls the number of buyers disappears. It’s been falling in value in real terms since 2010/11. It’s priced in USD so you’re trading Cable (look at the GBP price spike over Brexit).
Paul Tustain of BV is a good person and as gold is an unregulated instrument the market is mostly comprised of thieves and scam artists so you need to pick the forms you work with very carefully.
Is gold worth holding? No. Not for the vast majority. Most people who get involved with gold do so because it’s gold coloured and shiny or because they are old and scared that the world is going to end now that their children are running it not because they actually make any money.
Gold was the big scam sell in the long list of scam products before binary betting and now bitcoin. Millions of people were duped into buying various gold products, many of which where the gold never existed, from late 2009. But it’s been the only physical asset to not rise since about 2010/11.
There is no real reason to hold gold other than if you think you may need to cross a border quickly or if you think the world is definitely going to end unless you are arguably in the top global 1% then it becomes a diversity/hedge play.
It has no yield. It cost money to store. It’s unregulated. Has large spreads. When the market falls the number of buyers disappears. It’s been falling in value in real terms since 2010/11. It’s priced in USD so you’re trading Cable (look at the GBP price spike over Brexit).
227bhp said:
I looked into it and dug up some old threads on here, everyone told some guy not to bother, but if he had he would have made a large pile of money when you looked back to see how it had increased.
That really only would have been for a period in the 70s or for 4/5 years before 2010? Gold spends more time going down than it does up so you only speculate on it during those short windows of rapid gain. And gold is only really driven up by State purchases. No amount of Indian weddings or Channel 5 afternoon coin advertising shifts the market. The above ground gold market is estimated to be worth about $5-6 tn. Since 2009 the US have delivered over $4tn of QE. And of course, the supply of gold has risen so there’s been no reason on that front for gold to rise. Central banks haven’t stepped up any buying programs either so nothing exciting on the demand side.
The end of QE might trip a global economic set back and push gold up but while its still in its medium term phase of trickling down as money flows out of gold into other assets there seems little logic to piling in.
Dr Mike Oxgreen said:
He recommends owning physical gold via something like BullionVault rather than via an ETF or similar.
What are his reasons for not using ETFs?Holding gold and silver was the only bit of the book i did not fully buy into.
I'd personally rather own portions of productive companies, or property where rent can be collected.
I don't see the logic in holding anything that does not produce income as an investment.
Plus, if the global markets and economies crashed in such spectacular fashion, a bit of gold in your safe or in some vault somewhere isn't going to save us.
Perhaps a better "investment" for those of this nature would be to dig a secret bunker stocked with tinned food, bottled water etc but it's no way to live, being in constant fear of the armageddon!
I'd personally rather own portions of productive companies, or property where rent can be collected.
I don't see the logic in holding anything that does not produce income as an investment.
Plus, if the global markets and economies crashed in such spectacular fashion, a bit of gold in your safe or in some vault somewhere isn't going to save us.
Perhaps a better "investment" for those of this nature would be to dig a secret bunker stocked with tinned food, bottled water etc but it's no way to live, being in constant fear of the armageddon!
CzechItOut said:
What are his reasons for not using ETFs?
He expresses concern about the amount of “theoretical” gold versus physical gold, and that a paper claim on some hypothetical gold is not as secure as, er... a paper claim on some physical gold.trowelhead said:
Holding gold and silver was the only bit of the book i did not fully buy into.
Me too! The responses on this thread are reassuring: my scepticism is not entirely misplaced, it seems.Edited by Dr Mike Oxgreen on Monday 9th April 17:35
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hstewie said:
hstewie said: I can't say I quite get the point of it personally unless it's physically in my possession?
I think that's part of the point, ie in a worse case scenario it's portable (ish) wealth you can physically own it's tangible. It is 'end of world' talk yes but most peoples wealth is an electronic number or share certificate so not quite so tangible, also in the more real world is does tend to do well in a stock market crash so can be a safety buffer to that? It will never be valueless?
Scootersp said:
I think that's part of the point, ie in a worse case scenario it's portable (ish) wealth you can physically own it's tangible. It is 'end of world' talk yes but most peoples wealth is an electronic number or share certificate so not quite so tangible, also in the more real world is does tend to do well in a stock market crash so can be a safety buffer to that?
It will never be valueless?
Yes, but in an "end of the world" scenario I think the reasoning is you want to be able to reach out and grab it rather than owning something in a vault somewhere that you can't physically get at.It will never be valueless?
My theory is that Bitcoin will have a much more massive wobble when Satoshi moves a tiny, tiny amount of his stack.
The speculative money which is in BTC but doesn't want to appear on a regulators radar will run for cover in gold.
I got half-way through moving my monye from BTC to gold. I sold my BTC (Dec 14th) but have not yet bought the gold.
I have done well out of gold in the past and generally think it's a good time to buy.
Simon
The speculative money which is in BTC but doesn't want to appear on a regulators radar will run for cover in gold.
I got half-way through moving my monye from BTC to gold. I sold my BTC (Dec 14th) but have not yet bought the gold.
I have done well out of gold in the past and generally think it's a good time to buy.
Simon
I think that is his point. He continually talks about trading in silver as his best investment. The book is split between investments and trading positions. Half of it talks about what to be invested in and the other about what proportion but little time is spent about how to trade into and out of the risk positions (i.e., portfolio rebalancing). As such the physical commodities in my mind are just cash diversification tools. You either buy them and hold them and dollar cost average for eventual sale and use of said cash in your nominated currency of choice or you trade into and out of said commodity depending on economic cycle....
bhstewie said:
hstewie said: Yes, but in an "end of the world" scenario I think the reasoning is you want to be able to reach out and grab it rather than owning something in a vault somewhere that you can't physically get at.
I can't have worded it right as that is what I was trying to point out, it like having cash in a mattress only it's not so easy to spend and isn't affected by any currency performance/issues (just need to ensure it's the real deal!!)Personally I don't see gold as a good investment as such, more a store of wealth in case of financial collapse.
It's quite a good store of wealth if you are looking to hide money, and is very nice to hold and play with but aside from that there is little point having physical gold.
Still pretty cool holding a handful of 1oz cast bars thinking "each one of these is worth £950"
By all means buy some if it gives you a warm, fuzzy feeling but they are never going to make you rich.
It's quite a good store of wealth if you are looking to hide money, and is very nice to hold and play with but aside from that there is little point having physical gold.
Still pretty cool holding a handful of 1oz cast bars thinking "each one of these is worth £950"
By all means buy some if it gives you a warm, fuzzy feeling but they are never going to make you rich.
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