Investing in gold or silver ?

If you can't touch it, you don't own it.

Get physical if you're planning to hold for a decent amount of time. Avoid ETFs.

THe Olivia Newton-John approach you could say ?

http://funds.ft.com/UnlistedFundFactsheet.aspx?mid=CPGGA

J2blue is correct - you have to hold physical gold

buy gold sovereigns (us eagle, canadian maple leafs, south africa kruggerands) and a small safe. Job done

I used http://www.goldline.co.uk

Excellent service - recommended

Exactly why do you have to hold physical gold inorder to ride irs price curve ?

"----ride its price curve "

FAFH, you need to be clear in your own mind as to what your primary motivation is in investing in gold in the first place. Then the answers you are seeking become all too obvious.

* is *

Lost me M, I'm afraid.
Just remember, most of us on here are just mere mortals struggling to make a crust from the scraps thrown to us from the privileged elite.

Fine

Think about why you are investing in gold and why people tend to? At todays levels people are either riding the wave or looking for a safe haven. If you are riding the wave then it is at very high levels to start from and you pays your money and takes your chance. If you are looking for a safe haven then the only logical reason to get into it is to hold it.

Buy why necessarily hold physical gold as opposed to ETFs ?
The emphasis is on " hold". Does it matter how you hold it ?

Yes

fafh, what here some guys are implying is that the only reason to hold gold is to have an asset to protect you when all goes pear shaped. if you held gold in paper form, it s not obvious you wd get the delivery of your asset...
anyway, gold in physical form has its own disadvantages too.
first, it costs more.
second, it could be fake and you need an audit when you buy it these days ( likewise you wd be required to provide one when you sell in case of the collapse of the system ).
third, although a safer option in terms of investment, it doesnt strike me as the safest option in terms of personal safety. you all guys plan to have a safe, few bars of gold in it, and then sleep happy? if the system fell apart, would you risk to have something so valuable at home? locked?
fourth, although of course gold would keep a purchasing power, it would suffer a loss of value too, as it would lack the flexibility of use that paper money gives ( imagine a world with only 1000 dollar notes, next thing you know shopping at tesco would cost 1000 dollars ).

the only things to preserve your purchasing power in case of a collapse are your skills, your work ethics, your adaptability ( basically making sure the society needs you ). thats the only wealth you need to protect ( and increase ).

JW
What if you're well past the active working age ?

@ JW

b0ll0cks

@ FAFH

simple, if you are speculating buy paper gold, if you are hedging against a financial system collapse, buy physical.

OK then, I think I'll tell my " friend " to buy some of those nice little medallions, which will look so nice bouncing against his hairy chest whilst jogging along the beach.
Pull the chicks and protect against financial armageddon, all at the same time.
Sounds good.
Tks for all the excellent advice for my " friend ".

Don't be too hasty. If your "skill" is the world's oldest profession, then JW may be right, you don't need gold, just your skills if everything goes pear shaped.

And as long as you don't also go pear shaped presumably.

is it too much to ask which part you thought it was bllks and you didnt agree with>

is physical gold more expensive or not? ( clue: probably you can check even on the meerket website )
would you buy it if it wasnt certified? ( clue: check how much fake gold is around these days )
is it safe to keep it at home, especially as someone predicts at same time fights in the streets ( clue: ask the met police )
is it true that having all the 'money' expressed in very expensive cuts, would reduce the purchasing power of it? ( clue: check how much tesco pays for gold these days, and we re in normal times )
is it true that during hyperinflationary periods we have massive redistribution of wealth ( sometimes with violent modes too, clue: ask the zimbabwean landowners )? ask yourself who is sure to eat, a doctor or an insurance broker, a farmer or an m&a director? so is it so wrong to assume that making sure society needs you is your only sure way to mantain your purchasing power?

happy to have your comments, if they go beyond the single word. else, please avoid polluting the forum.

You still don't get it, do you?

I'm not a doctor, very few of us are. I'm a paper pusher, just like you. I'm not interested in "surviving" like a doctor would by offering his services, I'm interested in maintaining my wealth when the current medium of exchange collapses. And gold has proven itself the most effective wealth preservation/transfer mechanism in EVERY fiat money collapse in the 20th century. Get it now?

Your statements about fake gold, security and violence are so far of base, I won't even dignify them be debating them.

And the word you are looking for is "assayed", not "certified". You'd probably know that if you owned a single ounce of physical.

Stop posting rubbish, and I'll stop saying "bllks"





Suggested reading for you:

"When Money Dies" Adam Ferguson
"The German Inflation" Fritz Ringer
"The economics of Inflation" Constantino Bresciani-Turroni
"The Monetary Dynamics of Hyperinflation" Phillip Cagan
"Inflation Stabilization" Kurt Weyland
"The case of Argentina" Jutta Maute
"The Hyperinflation Survival Guide" Gerald Swanson
"Profiting in Economic Storms" Daniel S. Shaffer
"The Collapse of the Soviet Union" David Marples
"The Last Resort: A memoir of Zimbabwe" Douglas Rogers

Thanks for the advice. Some of them books I already got them.
You didn't anyway succeed to explain anything, you re so obsessed by the idea of having to win an argument that you don't even care to understand other peoples positions.
I never mentioned gold is not a way to keep your purchasing power. As a matter of fact I was the only one giving fafh a reply to his question. I added a couple of comments which wanted to highlight what's the cost of buyin that extra insurance in case of a collapse. As things don't come for free and arbitrages dont exist but for very short time  You (used as generic term) make your own calculations: is it a 10pct premium (and I'm sorry to insist: a security headache; you would be a criminal if you neglected these things having a family) worthwhile ? You decide: if hyperinflation is a likely scenario (more than 10pct) you take delivery. But if you think theres only a remote possibility of that happening but you still want to protect yourself angst inflation and rounds of Qe then paper gold is enough.
Some people here think that the next wave of the crises will bring riots and violence on the streets. Read above and all the other gold threads. if that's the case (not my view, I don't believe in hyperinflation to start with) I guarantee you you can survive with your stored wealth only for a limited period. I dont want to sound uber socialist, but it s always the chimera of the wealthy classes to believe they can weather any revolution. If the system collapses, it collapses in all of it's forms. Hence my comment about having to keep yourself adaptable and useful to society. If you want to know, the coS

Cell 1	Cell 2
Cell 3	Cell 4

mment was more directed to the guys here who are still at college, think the system is rotten to the core and forecast its collapse,but protect their future by buying gold In

(physical gold, mind you) instead of thinking to do something else with heir careers which shud be more rewarding in case of a collapse. Dont take all the comments as if they were meant to you only.
Ps you might be right about something tho, writing from the iPhone is proving a v difficult exercise :-)

What's the thoughts on having physical gold but stored in a bank vault? Is this safe? Or is physical in your own home the only way to go?

The HK Chinese filled their teeth with gold, and wore/carried at all times inordinate amounts of expensive jewellry, just in case they had to do a quick runner from the hordes of commies lurking on their border.
Of course that could just be some racist thing I read in a gweilo book of fiction.

JW, your are incorrigible. It seems that you are incapable of muttering "oh, I get it now" under your breath  and just walk away. Which inevitably means a lot of unnecessary work for me to keep explaining. Also you have a real talent for "evolving" the debate to only the points are too obvious to even dispute as a way out.

If you are buying from a credible dealer, there's ZERO chance, I repeat, ZERO chance of buying fake gold. The tungsten story was overblown and restricted only to bullion for obvious technical and economic reasons (the smallest counterfeit piece found was 16 troy ounces). One ounce coins would be very difficult to produce with tungsten cores and very easy to detect because of the "dull" sound produced when struck as compared to a high "ting" note on hard dense metals like tungsten. Plus economically it makes sense to "counterfeit" the larger bullion sizes if that were the case. There was considerable speculation that the tungsten core gold bars were planted to be "discovered" to suppress demand at the time (kill trust - evidently it worked in your case). Whatever affect it had on the gold market, it was very short lived. Any credible dealer will provide you with the assay results of your purchased bullion which include ultrasonic and accelerometer "hammer" (resonant frequency) measurements specifically used for tungsten detection (the speed of sound in tungsten is twice that of gold). The gold market, if the trend in the price of gold is any indication, seems to have shrugged off any concerns about fake gold. I would advise you to do the same.

Zimbabwe has had systemic violence for a long time now, even before their currency collapse, which continues right up to today. IT HAS NOTHING TO DO with their experience with hyperinflation and currency collapse. Surprisingly enough, the "violence" that has been for example historically recorded in places where the currency collapsed through excessive fiat money printing like Germany (1923), Chile (1973), Argentina (1980), Yugoslavia (1989), Russia (1998) has been mostly aimed at achieving political change. Hyperinflation was inevitably  followed by government collapse and regime change, it was NOT violence or crime directed at robbing fellow citizens of their stash of gold (those who had any). Yes, you're quite correct, I said they'll be fights in the streets (people have a tendency to get upset at their government when they wake up one morning and discover that those savings they thought they had in the bank are no longer there and those pensions they thought they had coming are being paid to them with coloured toilet paper), not in your living room stealing your family silverware. Read some of the books I suggested.

It seems to me like your "everything goes pear shaped" collapse scenario is an apocalyptic, thermonuclear war heads raining on out heads, an irradiated environment without food sources and people resorting to cannibalism to survive scenario ("The Road"). I don't know why anyone would want to even survive such a scenario, but yes, in this case, "skills" may be more valuable. Being a hand weapons expert and owing some would be far better than owning gold in those circumstances. That's not my view of the world. Life will go on, it always does, it's just that the next medium of exchange when we rebuild, following a period of mostly trading by barter, won't be fiat money based on "faith and credit" . And in this scenario, gold will perform it's function as it has for 6,000 years now in our history. Preserve wealth.

I think I'm just going to stick to just saying "b0ll0cks" from now on, a lot less work.

Whippet, if buying physical gold is used as a hedge against "everything going pear shaped" (I prefer financial system collapse), then it it very unlikely you'd be able to go into your banks vault to retrieve your gold. Some will even argue that there's also the possibility that your gold may be confiscated by the government similar to the experience in the US in 1933. I must admit I don't subscribe to the confiscation thesis but I do believe governments will find a way to heavily tax gold possession/transactions as they rebuild towards a different monetary system.

I'll say it again. If you are speculating, buy paper gold. If you are using gold as insurance against the worse case scenario, buy physical and keep it in your possession. History suggests that the notion that you are putting your family at peril by owning and storing gold is flawed. More people die in the streets of London every year from various criminal activities than people have been killed (in any society experiencing a monetary collapse in the 20th century) to have their gold stolen.

I'm seriously now investigating the feasibility of replacing the structural joists in my main house with gold ones. I'm assuimg of course that the current ones aren't gold ( the previous owner was rather richer than me), but I haven't actually had them assayed yet.

What a load of old alarmist cobblers this whole debate is.

I can't imagine that M is the most popular man in the office, given his dogmatic views on not only the inevitable but also the imminent cllapse of the world's financial system.
I can picture people rushing into their offices and closing their doors, as they see him coming down the corridor eyes glazed, steam coming out of his ears, arms waving in all directions, saying the end is nigh.

FAFH, I will try and keep the posts shorter and the language easier just for you in the future. I'm starting to believe that you are having trouble following. I did not say collapse is imminent nor that it is inevitable, although I must admit the solutions to this financial imbroglio escape me at the moment. I have no idea where you got that impression. But if it where to happen, I'm prepared for it. I knew the right answer to the question "paper or physical" long before you decided to start a thread on here. I also knew that I'd rather go through the transition owning gold (and lot's of it) rather than relying on my "skills" to ensure my family's sustenance in the future. It's just me.....

Mene, what are your views on the silver market? Obviously not the direction it is going, but whether it is manipulated, or whether the rumours that the comex don't have enough stock to meet delivery is actually true?

Is a scenario where the paper market crashes but the physical market is still high (because of lack of supply) actually possible? I guess it could be physical silver all the way if you believe any of the conspiracy stories out there.

My question on the paper and the physical aspect was more intended to be that if you invest in an ETF which only buys physical gold and does nothing else, then what is the difference between owning a certificate in that or owning a certificate that you have a bar of gold stashed in some dealer's vault.
I'm still not clear what the difference is tbh .

Btw M I really do appreciate your declared intent to keep your posts shorter and language easier in the future.
I'm gonna hold you to that one.

@ FAFH

I could answer your question and clear your confusion but I can't do it in ten words or less so you're on your own.


@ Whippet

Your post is full of good and loaded questions. I would have to have more time to articulate my views on the silver market and PMs price manipulation but unfortunately I just don't have the time this evening. I will try to do it some other time. In brief though, yes, I do believe the PMs markets are manipulated (like just about everything else now days) and that we are starting to see a real disconnect between the paper price and what's available in COMEX inventories. And there's nothing conspiratorial about it, unless investors think that an entire years silver production/supply just miraculously shows up in silver futures short positions on the market in the span of five minutes is normal. If you are genuinely interested in the PMs markets, I can recommend some good web-sites and blogs for you to follow. You can start with these:

http://harveyorgan.blogspot.com/

http://traderdannorcini.blogspot.com/

http://jessescrossroadscafe.blogspot.com/

Any chance I can eat humble pie then M ?

sorry to intervene again. you really have a bad way of pushing your arguments.
you decided to comment on the fake/non fake, which inceidentally didnt appear in my last post; and about the violence (ok, you have different opinions, i stay with mine: i wouldnt keep my wealth in a safe at home )
but you then avoided to comment on the points where you have no legs:
one, does it cost more to buy physical or not? what s the bid offer you need to cross to get in and out? as i said you need to associate a probability of hyperinflation bigger than 10pct only to cover this upfront cost. i understand maths is not your forte, but i dont have time to try to explain to you what s the meaning of expected value. i suggest you read 'maths made easy' by carol vorderman ( 1st volume ).
the 2nd main point is about what each of us consider the best way to preserve purchasing power.
of course we dont agree on this, we have completely different points of view about the world!
im of the opinion people should try to create wealth, not preserve it; im for the analyst who look at future earnings to value a company, and not just the cash in the accounts; im for attack not defense.
im very happy to disagree on this, i accept your point of view, but i dont accept that you might want to push your ideas as the only way. you just show that you re a clearly uneducated naive thinker!

Been away for a while and im not here to argue but still the forum is against mel, a few of you here talk sense from different views.

dont understand how mel is so wrong in your views.

one mans meat is another mans poison.

in short dont waste energy arguing if mel is so wrong oppose his views and profit / lose from it.

And all the bullion I have ever bought has been held in my hands.

thats the way i will do it, and made a good few quid from it.

And all the bullion I have ever bought has been held in my hands.

thats the way i will do it, and made a good few quid from it.

It's not a question of whether M is always wrong, it's more about that he seems to claim he is never wrong.
Quite a difference really.
I'd pick JW to trade me out of a hole any day, but I would probably pick M to stop me getting into the hole in the first place.

JW
Will you answer my ETF question re holding gold/silver ?.

JW, that's the problem with debating anything with you. You'll post a bunch of garbage that's 90pc wrong but then you'll erect formidable defences and a bunch of never ending strawman arguments to accentuate the 10pc part you got right......and then pretend the entire post was sound all long.

Where exactly did you see me take exception that it costs more? But not in the childish way you mean it. Your analysis is naive and totally betrays the fact that you've never own gold in any form in your life. You haven't a clue how gold gets traded or taken into possession, what the true costs are in either option, and what drives investors into the different investment choices, beyond what you may have read in some published article somewhere. Because if you did then you wouldn't post something so totally idiotic like "the probability of hyperinflation must be greater then 10pc just to cover the upfront costs" and try to pass it off as wisdom or a mathematical genius performing risk analysis (feel free to take your pick). So much for "expected value" and the "probability of hyperinflation"......but I must admit it does sound impressive to the lemmings.

I did take strong exception to the "skills are more important", "fake gold is a problem", "it's not safe to keep it at home" rubbish you posted and proceeded to post information as to precisely why what you posted was rubbish.  As usual you glossed over that part of the discussion by a bunch of "it's a matter of opinion", "we have different points of view", etc. Those who at one time thought the earth was flat had a different opinion and a different point of view too but that does not mean they were not dead WRONG.

You display incredible audacity for someone that I've taken to school every time we engaged in a debate on here calling me uneducated, I don't understand maths, naive thinker and a myriad of other insults. I still don't fully understand what you do for a living but if you are charging clients fees for financial advice or to manage their money, their fully entitled to a refund. Your views are so mainstream, it's laughable.

At the end, I only have one question for you. How does it feel to have missed gold's greatest bull run ?

I hope somewhere in Carol Vorderman's book you find the answer.

Oh it's just the posts meant for me that are going to be concise and easily comprehensible.
Not all of your posts.
What a disappointment, for me at least, if not for all of us.

Btw is that latest run up in gold prices now supposed to be better than the 77-80 run up ?
Umm.

There was a run up in 77-80??? I haven't heard.....ummm. I need to look into that...

It might serve you well, since you are debating which type of ETF to buy, to look up a historical gold price chart one of these days. It may also help you to consider the underlying fundamentals for the recent bull run. Do you see any of those drivers vanishing any time soon?

Sorry to disappoint you but you'll get over it.

I hope my post was not too many words for you.

Too few words in fact as the meaning of it seems to escape me entirely.
Ah well back to the drudgery of just relying on my advisers.
I find it's always a mistake to try to get too close to these things.
Always ends in embarassment to all concerned.
Btw were you out of kindergarten in the late 70's ?

On reflection I'm probably doing you an injustice M.
You were probably reading and critiqueing Keynes before you even left kindergarten.
A wunderkind no less perhaps ?
Incidentally have you thought that perhaps Mayfair might not be quite the best place to live and have a relatively large property investment in, come any " blood in the streets, sack the bankers " type world financial collapse ?.

Enough of these childish late night ramblings of a bored soul.
I'll let you and Johnnie get back to the meaningful financial debate on this thread.
As I have said before, very entertaining to watch from the sidelines.

"very entertaining to watch from the sidelines"

This is the most honest line you ever posted on here. I doubt you have enough money to consider investing in bubble gum never mind gold ETFs. Anyone considering gold in any form as an investment would know and understand it's fundamentals and investment options without having to resort to posting on a gambling website's forum to find out (some much for having "advisers"). You would also know that smugly suggesting the "spike" in the price of gold in early 1980 was the greatest bull run is a red herring. It lasted virtually a few days and we were back trading at over 40pc lower than the peak a mere eight weeks later.

Most of what you post on here is not intended to add any value in any discussion, I'm not sure you know enough to be able to do that. It is only intended to provoke others into debate for, by your own admission, entertainment. In other words, just to keep things simple so you can understand, you sir are nothing more than a common.......TROLL.



P.S. : For the record, I work in Mayfair but I live in Knightsbridge, at least get your facts straight.

You're absolutely right.
I suppose in defining a bull run I was theoretically talking about a spike in price relative to the time period involved and for someone getting in and out at the perfect entry and exit points, which of course nobody ever does ( oh wait a minute you do, quite often in fact it would appear).
But no matter.
You're in essence right about this forum not being the place for me, but maybe not only me, but perhaps no one else at all who dares to have the temerity to prick your little bubble of arrogance and superiority, either seriously or in jest. I am more disappointed in your lack of humour perhaps than you're myopic, impractical intellectuallism.
You have given me great cocktail party fodder over the time I've been on here ( eg the GE bankruptcy call is enshrined in legend at a few of my favourite beach bar watering holes) and so it wasn't all a waste of time.
Sorry to hear you haven't yet made it into Mayfair, but Knightsbridge can be quite nice though ( if you're in the right street of course,).

The saddest thing about this forum is that it gives a chance to a clueless lemming like you to shout overt and thinly veiled insults at every opportunity to a poster like myself. The nice thing about a forum like this is that it gives a knowledgeable poster like myself the chance to put you in your place each and every day. Get a life, or better yet, GET A CLUE.

Here, take this at your next cocktail party:

http://www.propublica.org/article/general-electric-tapped-fed-to-borrow-16-billion

Menelaus

You seem like a pretty clued up fella but feel free to take a tip, or otherwise, from a master of word play in that if you are going to talk down to people at least do so with a little humour. That way an outsider is less likely to conclude that two buffoons are rolling around in the mud.

Not personally suggesting that I have witnessed any buffoonery of course.

The basic truth is that Menelaus would be sorely missed by this forum, whether for the right or wrong reasons,but I will never be for any reason.
I will just have to get on with it I suppose, whatever it is supposed to be.

Menelaus has also driven home a very basic truth to me.
I don't really appreciate how lucky I am in life in comparison to him.

I wouldn't argue with that, you are incredibly lucky. Hell, what am I talking about, even the scriptures agree with you.

Matthew Chapter 5 Verse 3

I'm afraid I'm more in the school of thought that if there isn't a God, nobody will notice the difference.

And if you think I'm going to google Matthew Chapter 5 Verse 3 you are very much mistaken.
That would be intolerable.

lets make an example.
i want to preserve 1mion worth of purchasing power.
i buy paper gold as i think gold is guaranteeing the best hedge agst qe, inflation, debasement whatever you want to call it. i spend 1mion today and in 90% of the cases i get 1mion of purcasing power -expressed in gold- back, while in 10% of the cases - hyperinflation - i would get zero lets assume ( actually you wd get a bunch of dollars back, so probably a bit more than zero )
i could buy also physical gold, but at 10% premium over paper, i would get only 900k worth of purchasing power insured as the rest is the cost of higher fees. hyperinflation or not, you would still get 900k of purchasing power ( in fact in the 90pct of the cases, ie no hyperinflation, you would necessarily have to pay a bid offer to get out of your investment )
in terms of esperance matematique, you need to associate a higher than 10% probability of collapse to prefer physical to paper.
now, coming back to the gold run. the fact i only own gold in form of watches, doesnt mean i didnt partecipate to the rally. i know you pretend to ignore it, but i trade ccies for a proprietary desk. i trade gold - anc chf - on a daily basis, i have some positions i m running since few yrs, some position i took profit on, some others i wd keep for ever ( i m running some positions since they were expressed in DEM for yor guide; and you can keep em for so long only if they re in the money.. ). Pa i trade the same way ( although, earnign by contract a fix pctge of my profits as compensation i tend to use the most efficient and leveraged way to make money, ie the bank liquidity and balancesheet ). sometimes i buy gold, some other i sell it. end of.
i seem to recall anyway, that in a previous thread you mentioned you didnt have gold in your portfolio. i refresh your memory: we were talking about the average duration of an fx trade, you were arguing it was a mere few seconds, i was arguing that you were confused with algo trading. i asked you why otherwise you had held gold positions since yrs anyway ( given gold is a ccy ), and you replied saying that i must have had the wrong impression if i thought you were invested in gold all this time.
unless of course you had been short on the way down and then succeeded to buy the dip. lol.

I'm still not sure , even after reading your example, why paper gold( if it is in the form of an investment certificate in an etf buying only physical gold) is different from buying actual physical gold ( in the form of a certificate certifying it is held in a vault allocated specifically to me) ?
Is it that perhaps the former is a share a pool of gold, whilst the latter is a specific allocated measure of gold ?

Also JW what is your view on the historical trading argument that if and when any particular traded item starts to become really noticeable / popular with the general masses, as here in that the price of gold starts to be reported on a headline daily basis by all news channels, then that is perhaps the time that the rally is approaching maturity and/ or the end.
That is effectively the amateurs now start to come in en masse to take out the pros giving them realised profits to reinvest elsewhere, and giving the amateurs at best underperforming assets in the future ? 
Or is that not happening here in any form or manner ?
That is M's point that all the rally drivers are still in place and getting stronger is unchallengeably correct ?

Sell when the shoe shine boy tells you to buy. The question is how many people do you know who are buying gold?

early morning riser is buying silver EO, so the time could be close. if benny and lampus get involved then definitely sell.

Benny and Lampus will be buying on the way down. I'm sweating about EMR buying though.

I'd love to continue the debate but I won't invest the time in reading and deciphering a collection of random thoughts put together in a string of running sentences in one never ending paragraph. Is it too hard and time consuming to capitalize the first letter after a period?