Posted on 12/12/2012 5:33:03 AM PST by DeaconBenjamin
Like Scrooge McDuck or the dragon Smaug in J. R. R. Tolkien's The Hobbit, Germans are gathering vast quantities of gold - a study showed that the average German owns close to €6,000 worth of the shiny metal.
Even though Europe's largest economy has weathered the world economic crisis relatively well, Germans have still been extra jittery about their savings, a study by the Steinbeis Research Center for Financial Services in Berlin revealed.
Around 32 percent of the gold owned in Germany in the form of bars and coins was accumulated since the financial and economic crises began, the study concluded.
Commissioned by precious metal trading group Heraeus, the study also found that people with surplus cash are becoming gold-greedier. The number of Germans with a net monthly income over €4,000 who say they intend to invest in gold has doubled in the current year.
On average, every German owns around 117 grammes of gold, comprising 55 grammes of jewellery and 62 grammes of bars and coins, the study, which surveyed 2,000 people, found. Taken together with gold securities, the average German owns some €5,750 of gold.
Including the German federal bank's gold holdings, that means the Germans have gathered seven percent of the world's gold.
Gold is considered a safe investment in times of economic stress because the precious metal is thought to keep its value over a long period, can be collected and kept safe personally, and can be traded easily.
Some 69 percent of Germans have invested in gold, and roughly half of these keep at least some the metal in their homes. Around 47 percent keep their gold in a private locker in a bank. Around nine percent, meanwhile, keep some of their precious metals with a specialized gold trader.
Rich people are more likely to invest in gold bars, while those on lower incomes are more likely to buy gold coins.
I have read that only 2% of Americans are tuned into gold coins and silver coins as being serious items of real worth. The average American is thoroughly hypnotized into believing that credit cards and blips on hard drives (they probably are oblivious to that too) are what money is
The real mind blowing activity these days is that private bank called the Federal Reserve buying up a trillion of 0Bama-debt each year. Taking the place of China which has opted out of the charade
Right. Because Tulip bulbs have been a source of wealth for
5000 years in just about every culture on Earth. Let me guess, YOU hold paper, or BULLETS AND BEANS !
Me I’m holding some of each, including gold and silver.
Hard to argue with 5000 years of history if you are a conservative.
If that’s the case, I’m pretty well ahead of the curve, and since I have abounding respect for you as a FReeper, Mr. Twain, you have settled my unease a bit with your post. Thank you.
Thank you for the kind words. Food that can last a couple of years also gives me a warm, fuzzy, feeling.
To take a page from our own Travis McGee... a sailboat that you could live on might be nice.... but then there are considerable costs for upkeep.
Excellent article! Best I have ever read on the subject of Germany’s hyperinflation.
I have a friend who’s a pawnbroker. I pay retail but I don’t get cheated. I would never buy through the mail or online but, as I mentioned, I’m a paranoid.
Excellent article! Best I have ever read on the subject of Germany’s hyperinflation.
Excellent article! Best I have ever read on the subject of Germany’s hyperinflation.
Gold does nothing but sit there. It does not produce anything (other than a small amount which is used in electronics). It does not pay dividends. It does not increase in quantity as it sits in a vault. Instead it either costs money to store or is at risk of being stolen from your house. It is a horrible investment.
But the Germans are arguing that even as bad as it is, it is still better than cash, real estate, bank deposits, corporate bonds, government bonds or stocks and that shows just how bad they think the current situation is. And I think that they are right.
By mid-1923 workers were being paid as often as three times a day. Their wives would meet them, take the money and rush to the shops to exchange it for goods. However, by this time, more and more often, shops were empty. Storekeepers could not obtain goods or could not do business fast enough to protect their cash receipts. Farmers refused to bring produce into the city in return for worthless paper. Food riots broke out. Parties of workers marched into the countryside to dig up vegetables and to loot the farms. Businesses started to close down and unemployment suddenly soared. The economy was collapsing.
That's going to go over like a lead balloon, here in the ARMED United States of America.
This is why gay marriage and gay anything is such a joke. They want to repeal 5,000 years of Jewish + Christian religions and culture. They want to nullify 5,000 years of Christianity and Judaism to suit themselves. The only brave new world they have is one with no morality and strong parties such as Muslims and Chinese take over...
>> the Germans are arguing that even as bad as it is, [gold] is still better than cash ...
Yup - it’s pretty hard to print more gold.
Please do some research on your own. Taking advice from a we forum, no matter how well intentioned, is a bad idea.
We do not know your situation, your tax issues, your family issues, where you would store it, any of that stuff.
And the thought of cashing in your retirement to buy gold sends shivers down my spine. If you think it will go up the 30% you will lose to taxes and penalties...then consider it. But think that through completely first.
I am not trying to be a jerk, but rather direct you to do a lot of research first. My advice is probably not right for you. Nor is yours appropriate for me.
I have no intent on taking the word of anyone on FR over that of my financial advisor nor do I intend on purchasing anything so pricey as gold before consulting my wife. I am simply soliciting for anyone’s experience with gold brokers either on line or over the phone.
I hear advertisements all day on the radio and TV, and I know that much of it is scaremongering. I would, however, like to have some tangible assets for long-term investments, and gold seems to be pretty solid.
Like all investments, there’s risk, and the cyclical nature of the markets, both financial and ores, leads me to believe that gold is likely to lose value at some point and will likely gain again at some point later. I know that it’s foolhardy to think that in a SHTF scenario people would take cold coins over practical goods in barter, but I figure IF (big if) the global markets and governments stabilize again, having everything in gold is not only dumb but costly.
Be sure to stock up from COSTCO with cases of SPAM. Gold is hard to chew.
Beware of the places advertising on TV. If you want to buy gold, you generally want it valued on its metal value. Right now that is $1711.49 per troy ounce. The places on TV will very quickly try to get you to buy collectible coins instead of bullion because there is nowhere to check their true value. If someone offers you gold for $1750 then you might say the markup is reasonable or not and be able to compare it to other sellers. On the other hand if someone offers you a "rare" coin for $2500 you don't have an absolute frame of reference on whether that's a good price or if you are being screwed on the mark up. Even if you can look up a price, are you sure that it is really a "Very Fine" coin instead of just "Fine"? There will be a big difference in value based on a very subjective grading.
“Where do you buy? Online or local? When we’re talking about $1,000+ purchases, I want to have my knowledgebase set pretty firmly and buy from a reliable dealer. I’ve been asking FReepers about gold since the election, just haven’t had any definitive answers on all my questions.”
I recommend you start out buying at coin shows. Google for “coin show” to find a schedule of shows around the country. Any large city should have a couple per year. Most coin dealers will have an assortment of both new and old gold coins to choose from. Shop around. I suggest you buy new bullion coins because they have a lower premium over actual gold value. Canadian Maple Leafs or South African Kruggerands would be the safest bet. If you hesitate buying at over $1,700/oz., then consider if the government is going to stop printing inflationary funny money any time soon. My last purchase 3 years ago was at $900/oz. No regrets.
Yes, that section shouted out to me too. There is much to observe, evaluate and prepare for from situation during those years in Germany.
German banks, for the average ‘Otto’, are less than attractive. Banks decide how much a person can withdraw from their savings account per month, not the owner of the account. If one wants to withdraw more than the bank deems ‘sufficient living expenses’, proof of need is required. Many of these banks are partly owned by the government and, over the last decades, have pushed sales of bonds and other investments that have performed so poorly several are now demanding repayment of all dividends sent to owners since inception. Many of the elderly pensioners have a majority of their assets tied up in these funds and it appears they either will or already have lost everything.
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