Thursday, April 15, 2010
Did You Need More Reasons to Invest in Physical Gold?
People want different things from their investments. Pure speculators and traders only care about the scoreboard - how much money their maneuvers in the casino net them. Others want to be able to sleep well at night. Some want to enjoy their investments (i.e. a vacation home or artwork) while they make money or they can't really see the point. And so on.
For those that want information on what else Gold is good for other than making money (lots of money, by the way), I draw your attention to a few societal and political implications of investing in Gold. Trading paper fiat debt tickets (i.e. currency notes in any country in the world right now) for physical Gold has multiple consequences that impact the world on a micro level. If many citizens of the world do the same thing, there are also macro consequences to such an investment choice.
Physical Gold held in one's possession as a form of investment does several things:
*Deprives Wall Street and other bankstaz of revenues, since Wall Street doesn't sell any actual Gold, only paper derivatives on Gold. Those who buy physical Gold instead of other financial assets also deprive Wall Street of the ability to pick the retail investor or trader's pocket. The casino can't make money when there aren't any patrons.
*Deprives government of revenue and power. Buying and holding physical Gold means you're not investing in government bonds. The less people are interested in government bonds, the higher the cost of their capital will become and the less they will be able to borrow. Not churning a stock account means you are generating fewer capital gains taxes. Not buying real estate means no extra taxes for local governments. Less tax revenue means less money for new harebrained government schemes/scams and less money to expand the scope of government.
*HELPS THE GOLD BULL MARKET PROGRESS FASTER!!! This cannot be stressed enough. Metal futures, ETFs and pooled accounts allow the fractional reserve scheme in Gold to continue. The less investors take delivery, the slower and less powerful the ultimate moves in the metals markets will be. New paper Gold instruments are becoming available every day, but it is physical demand that will send prices to the moon. Retail investors are so scared to take physical possession of their investments even though $11,000 worth of Gold (at current prices) is only about the size of a roll of quarters. Many of the same folks who would give their life savings to the next Madoff are scared to keep a few shiny coins in their house or apartment.
*Allows people to educate their family and friends. Show 'em a shiny Gold or silver coin and let them hold it. Let them see what real money is supposed to feel and look like. Most Americans haven't a clue. Many will develop a strange fever upon exposure and never look back...
*Protects you from government confiscation. Your 401(k) and/or IRA is not even half as safe as you think it is, either as a tax haven or as an asset exempt from confiscation. Government promises are meant to be broken when times get tough. If you lose your job and can't pay your real estate taxes, even a paid-in-full home will be subsequently lost to the government! Bank holidays are government-mandated events that can prevent you from accessing your money. Many Gold bulls worry about the government confiscating Gold (again), but with physical Gold you have an option if the mandate comes down. In other words, civil disobedience and ignoring the order is an option when Gold is buried in your backyard. This is not necessarily so with the GLD or SLV ETFs, centralized pooled metal accounts or safety deposit boxes.
Just some food for thought...