Your Questions About Invest In Gold Bullion

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George asks…

Is it a good time to invest in Gold?

I wanted to invest a little in physical gold. Does the price of gold keep rising? I tried to search for gold bullion and there are so many varieties. Which bullion is the most popular? Thank you

financi4 answers:

I think Hans needs to catch up on current events. Precious metals seem to have become positively correlated with stocks. We seem to be entering an environment of “risk-on/risk-off” (I stole that from Jerry) in which everyone suddenly panics about liquidity, sells everything and buys dollars. Gold is down about 3% now today.

Judging by recent news you could make a decent trade by buying gold and shorting silver. I’m not doing it, but I would like someone to do it and keep me informed so I can vicariously trade.

Edit: Jimmy is completely wrong about that – bad news hits gold hard these days. A deflationary US recession for example would be very bad for gold. The keyword now is liquidity and gold doesn’t cut it.

Robert asks…

Can anyone plz. explain me, wat is GOLD Bullion and where do I buy it from?

I want to invest in gold. Should I buy it from a jeweller or through ETF or a gold biscuit from the bank?

Which is the best option and why?

financi4 answers:

Gold Bullion is just gold.

If you want physical cold buying gold coins is a good way to invest, the best known being the South African Kruger Rand and the Canadian Gold Maple Leaf.

If you prefer shorter term investing, it can be bought through brokers.

Donald asks…

Can someone give me advice on investing in gold bullion? Is this a pretty safe investment?

financi4 answers:

Gold should not be viewed as an investment, but as an insurance policy. Gold purchased 10 years ago would have doubled in prices. That’s little more than 7% interest. Gold purchaed in the early 80s and sold in the mid 90’s would show a decline of over 50%. Again, it should be viewed as insurance. You should have at least 10% of your investable assets in gold.

Owning gold will protect you in times of severe inflation, depression, recession, declining dollar, war and turmoil or the end of the world as we know it. It is at these times that the worthlessness of the dollar becomes apparent and people see the value of gold.

I prefer the hard shiny kind rather than ETFs or certificates because, after all, you’re preparing for the unknown. In an emergency, you don’t know what will happen to the institutions holding those vehicles, but you will know about the gold you have stashed away. In an emergency where financial institutions are off-line and the dollar is distrusted, folks will trade goods and services for the shiny stuff.

Do not buy “rare” gold coins. Instead buy Bullion. Bullion comes in coins and bars. Bullion sells for the price of gold + a small premium for minting. Bullion coins are generally more expensive than bars because they have the backing of the govt. That produced them, are easily identifyable and are harder to counterfeit as well. Either is good.

American Eagles and Krugerands are 22Kt and weigh 33.9 grams per ounce.
Bars, Austrailian Kangaroos and Canadian Maple Leafs are 24Kt and weigh 31.1 gram per ounce.
Either contains an ounce of gold. The 22kt kind contains a bit of copper as well for hardness.

Buy a gram scale to verify the weight of your bullion. You can find these on ebay for ~ $10.

Store it safely and keep it quiet. With recent bank mergers, safety deposit boxes have been subject to “disappearance” and many people have lost their contents. Beware.

Never sell your gold for anything but cash as you may find the IRS looking for their cut.

Good luck.

John asks…

I am thinking of investing in gold bullion. Is this a good investment?

financi4 answers:

First off you need to understand that gold is not an investment. The best way to own gold is to buy and take physical delivery of the gold itself. Silver is also in the gold realm as well, so when talking about gold, silver is included. The most important thing in this economic crisis is not return on investment, it’s return of capitol and purchasing power.

Gold and silver is money and a store of value. It is the “Currency of last resort” as Greenspan has stated many times through the years. Gold doesn’t pay interest, dividends, doesn’t restate earnings, has no lawyers, accountants, CEOs or CFOs lying to you on television. Gold doesn’t ask for bailouts, doesn’t go BK and cannot cook its books. Gold cant be debased or printed at the will of a company or government and holds its purchasing power.

Gold sits there as a store of value, is labor intensive, and a one ounce coin will not split into a bunch of half ounce coins at the direction of the pin stripped bandits on Wall Street. Also Gold is the ONLY asset class in the last ten years to increase in value and retain every dollar of its purchasing power.

The earths crust only yeilds so much of it. It has value due to the fact that its rare and one cannot reproduce it with out the hard work and real labor it takes to obtain new material from the ground. This is why its money. It represents a store of the value of the real working man. The labor and costs required to obtain an ounce of gold is the same as the labor, materials and costs to produce a fine handmade suit of cloths. This value has not changed in 5000 years. Gold and silver were money and represented a store of value long before Charles Dow ever invented that exchange.

It has value for all these reasons but the most important one is the fact that it cannot be reproduced for a low cost.

People can debate all they want about gold and silver but the fact is where everyones stocks, bonds, real estate etc have declinded in value, only physical gold and silver are up. Ill continue putting my wealth in something that can’t be debased.

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