“Dave Ramsey told a caller once that he’d be better off with a can of soup and a gun, if it hit the fan.”
I love how gold is always held up to this ridiculous, pointless standard: the “what if civilization ends” standard. If the economy suddenly collapses, and only the most urgent needs are important, then gold will be nothing like food, water, and shelter. But how come we never compare the things people usually invest in (not that gold is for investment, persay, rather than ) to the chaos standard? How come calls for investing in stocks, bonds, commodities, art, baseball cards, etc. are never met with, “Yeah, well, you’ll be sorry when wild gangs of violent punk nomads rape women and children willy-nilly and everyone’s house sponteously combusts on a regular basis.”
I know why. It’s because gold is commonly advocated in times of danger. Except when most people talk about hedging against inflation, they’re not necessarily imagining Weimar inflation. There’s a lot of space between cash losing value and blood running in the streets.
“There’s a lot of space between cash losing value and blood running in the streets.”
Not as much as you might think. History has shown that civilization is a thin veneer on society. After people miss a few meals, their children are hungry, or this month’s welfare check doesn’t arrive, you will see how thin a veneer it is.
I agree that gold is a good hedge against inflation. I heard a quote once that in 1910, a one ounce gold coin would buy you a very nice suit...and it 2010, it will still buy you a very nice suit.
Over time, gold pretty much follows inflation.
...but its the selling of gold as a hedge against end of civilizaation scenarios that Dave was talking about.
And also, since it is a commodity, he would suggest just investing in a cd, which is much safer....what would happen to gold prices if next week somebody found a huge deposit, or somebody developed a way to extract more gold out of existing mines? I think this actually happened to silver once, and the bottom fell out.