Precious metals are a hedge against inflation and a security instrument. In our investment driven media world everything is viewed in terms of investment performance and this does not capture why I like precious metals.
You can say the same thing for beans and bullets. Some of us want to preserve our wealth and a commodity I physically possess may ultimately be worth more than a commodity stored in digital format at a bank. Which one do I really control?
Many folks would be wise to modify their investing beyond recommendations of the chattering class on the business channels. Worse case scenario - I can eat my food investment in the next decade. My grandkids can shoot a mosin-nagant (or other variety) rifle forty years from now. I am not sure I can say the same thing for my mutual fund so I might be very happy I invested some of my portfolio in useful commodities on hand versus the wall street casino that is ultimately tied to the value of a dollar controlled by reckless politicians and greedy banksters.
My 5 gallon buckets of screws and nails may be worth more than a few shares of a mutual fund in 10 years. Same for 5 gallon buckets of 22 ammunition. Same for 5 gallon buckets of honey, sugar, salt, oats, beans, and rice. Silver and gold will always spend - I am not so sure about the purchasing power of a $20 dollar bill in 10 years.
My orchard will probably have great value in 10 years as will my garden and pasture. I am still invested in the market because of my job, but I try to invest in useful commodities with any extra money. I even have bins of nice clothing stored for my small children thanks to the thrift stores.
Just food for thought and best of luck diversifying your portfolio...... Think outside of the electronic box!
I agree with your thoughts.
I would only add a couple things...
1 gold is a hedge against government - it hedges you against the manipulation of fiat currency by governments
2 hedging government jurisdictions is always the best diversification - in this case, gold outside your own country - if everything you own is in one jurisdiction, it is exposed to keystroke seizure and you are not diversified or secure in your property - this will eventually be outlawed through capital controls... Act accordingly, while possible
3 if everything you own is denominated in one currency, you are not
diversified
4 I believe we are entering a time where paper assets will be traded for real things - act accordingly
This is my studied opinion, which I have acted upon for the benefit of my family. Readers will make their own call and live with the consequences.