I was twelve years old... my paper route money covered only basic expenses back then.
Cop out.
I was twelve years old... my paper route money covered only basic expenses back then.
Now I understand your gold bug blinders now. Short story. The week before the market crashed in 1987, it had a few mini-crashes. It was real volatile. The day before the crash, I sold every stock I held and put it in a gold fund. The only gold investment in my life. The market fell 22% on Monday, dwarfing 1929. I had a friend who had made millions selling puts the previous months. He lost $500,000 the week before the crash, and finally closed it all out also on friday. He would have been bankrupt that monday. The world stopped that day, people were beyond tears. I had to pinch myself and keep quiet...I cleaned up and made a ton. The next day I finally told a few friends, and sure enough, day 3 it plummeted and I sold the position for a small loss. I got greedy. Take their money, before they take yours. Target investing works. If you're a chartist, here's the most consistent way to make money. By the dow index Nov., sell it in March. Averages around 10% for 50 years now. Feeling lucky, buy the same only in out of the money call options.
You miss the point, or I do. If one is buying gold to compete with equities in the world as we know it now, I believe one is making a mistake. Stocks over the long run always outperform gold. If you are saying paper money is worthless today, that is also wrong as we use it every day.
Now if you are buying gold as insurance against a very different world, one where terrorists nuke a city or so, Israel and iran exchange weapons, perhaps oil hits $100 or more a barrel, or we have a real 1918 style Bird Flu pandemic and it lasts a while, then the world as we know it could be very different. Will folk trust paper? Will the government be shown to be incapable of protecting the citizens? Could a future liberal US government react with freedom limitiations and gun grabs?
In a new set of situations and realities, what would you rather have, a shoe box full of paper, or a pound or so of gold and a few score silver dollars?
I buy gold for the worst case scenario, not to churn it for more paper money. It is also why I only have a small bit of my assets in gold. What are the odds of a worse case situation? A good bit less than more of what we have today.
I buy with a desired limit in mind, then I plan to sit on it like I do my insurance policies.