What is the value of Gold? (AU)

I want to remind anyone that listens: if you are holding gold as a safety hedge - make sure you personally take physical possession, otherwise you could, I think likely will, lose everything in any degree of crises. I have been saying this since the turn of the century and, 2021, I believe it any more. This applies to any precious metal including silver. Holding paper doesn't protect you. Having it in someone else's vault is SLIGHTLY safer - but look what happened to Crowne Gold - I know one company that lost everything and went bankrupt, in part because they trusted Crowne Gold to hold 'their' gold for them - and they had most of their 'cash' assets in gold. I work in both Canadian Dollars and US Dollars, so these charts are the best for me. If you click on them, it will take you to the sponsor site where they have lots more info on other precious metals and other currencies. Note: I've been told that, since I have Gold near the top of my list I must be one of those that are opposed to paper money. But that would be an incorrect assumption. It is here because it is convenient for me, and maybe for you, that is all. Don't read more into it.

Interested in purchasing gold - the physical item, for the going price? Normally you have to pay a significant premium to take physical possession. However, if you are interested in purchasing with cash, from time to time there is the opportunity to buy the physical gold in the Calgary area for the going rate as posted above. Imagine - owning the physical gold for the same price as owning a piece of paper that claims you own gold. This is much safer (in my opinion) than owning the paper for a variety of reasons. For example, a company "crowne gold" (they have a .com web site) talks about why you should own the real item, which, while they would disagree, I believe means: you should NOT use them! What is interesting, is, after telling you should have the real physical gold, they claim they physically hold the real item for you, but a report I received in April 2006 - a company that owned some of that physical gold couldn't get their money out in cash because crowne gold didn't sell the gold when they were requested, and the price of gold collapsed temporarily, so the company had to wait until the gold prices returned before they could get their cash out!!! If you own the physical gold - you know that you are secure and can sell it any time you want, though it may be physically challenging and you can't time it to the minute realistically. Of course you then also need to provide physical security for it, so think that through carefully as well.

• I see that in 2008, if you had Gold that you entrusted to Crowne Gold, the IRS stole it all from you with no opportunity to obtain it. One company I was dealing with had 80% of their cash assets stored in the 'very safe' they said, Crowne Gold - where they had the PHYSICAL gold. One of the people affiliated with them personally saw where it was stored. But then Crowne Gold had all their assets confiscated by the US government, and the Canadian company I knew lost EVERYTHING. Basically, either the IRS stole in from them, or Crowne Gold had already stolen it from them. Weeks before all 'your' gold disappeared, they were getting great reviews like this one: http://alansmoneyblog.com/2007/11/03/review-crowne-gold-digital-gold-currency/#comments (still live in early 2021!) but since 2008, most people promoting them, took down their pages to hide their previous bad advice. Check out the internet time machine, you will see I ALWAYS had claimed that Crowne gold was nothing more than 'paper' gold.

If YOU don't hold physical gold, you don't hold gold, you hold paper.

I claim that, if you have gold in a vault somewhere that you don't physically control, you don't hold gold. You hold paper. Other locations have been accused of having 'your' gold in a vault that they charge a yearly fee to hold for you ... but then it turned out that, while you could come and 'see' your gold ... they sold the same gold to more than one person and if that person had come to check, they too would have been shown your, I mean THEIR gold.

If you don't hold physical gold, you don't hold gold - you at best hold paper. So if your REASON is not 'investing', and your REASON is a safety hedge - you must by physical gold and physically hold it.

As for me - I admit, I don't have any physical gold to speak of - my wedding ring wore through in a few years so we got matching silver bands. I probably have SOMETHING with gold - perhaps the contacts on some of my computer chips. Oh, and a $17 bottle of liquor that claims to have gold leaf in it. Oh, and a plated rose that cost me $40 - so you know it doesn't have much gold either!

I choose instead to go with 2 ideas: 1. I invest mostly in myself and 2. invest in a variety of things so if one or two or 10 go down, the others are hopefully going to balance it out over time. But if I *did* invest in gold to any large degree, I would likely find some way to go with the physical gold, or maybe just invest in a bunch of gold mines, I don't know! And if I held enough to steal, I wouldn't 'hold' it in my house.

I've had a conversation with a long term friend that keeps trying to convince me I should be holding 75% of my wealth (what little I have) in gold or silver. He has several arguments why:

• there will be some black swan event that is going to collapse our monetary system world wide, gold will be the only haven
• gold is the best long term investment
• holding money is dangerous, because it is going to be devalued horribly. (Doesn't matter to him whether I'm talking CDN or USD or any other currency.)
• the government is going to tax us on inflation that they create so they can erode wealth
• in a crisis, the banks will refuse to give me access to my money. And a bunch of other reasons.

And he tells me he physically hides his gold in the ground deeper than a metal detector can find because...

• the government is going to go around and confiscate all the gold as 'their' property.

His biggest concern though was the complete economic collapse. My response was: If there is a total collapse, you care about heat, water and food. And you can't burn, drink or eat gold. As the saying goes (and no it is not in the Bible) When that day comes: "A piece of bread will buy a bag of gold." Larry Norman.

So it seems to me that having assets (land with trees you can burn, garden, livestock, electric panels and replacement pumps and a well or two) that protect against those three, if that is really why you are buying gold, is a better choice. But I admit, as I see it, there will be massive die off if that happens, and trying to plan in advance for survival in that scenario, will mean living a 'survival' life starting right now, and I'm not interested in that - and in any event, I just don't see owning a lot of gold would help in that scenario. I heard one discussion between a Mormon who was trying to convince another person that they should have a 3 year stock of food and water kept safe in their house against a collapse. The other man said "Why? I have a gun and a map of the houses of 20 Mormons - and you said you don't believe in guns." (Note: I've heard it said that it is now down to only 3 months supply, and I've heard up to 5 years in the 70's was what was recommended. The 3 years was just the value the gentleman was using back around 1975 as his temple's recommended amount.)

My point in this is, if you go all out preparing for an extended total disaster, you will have to figure out how to protect it - and whether you are willing to do what is necessary. If not, and you have, perhaps 3 years supply of food, it won't take much time for people around you to find out that you have food.

I have never done stocked food for any long term disaster, but I figure: If there was ever a disaster to the level my friend was talking about, I would fast for 40 days (I have done it once, so has my wife, Update: 2012: I have done it twice.) so that a) I look like I don't have a supply of food and b) my metabolism is so low I require almost no food to be kept alive. I'd then have 2 food sources - one that I share and let people steal at gun point, and another smaller supply stored elsewhere. But really, I have no intention of doing this. I'd do the 40 day fast to get my metabolism down, but then I'd share whatever food I do have and then live with the same problems and restrictions that my neighbors have. That seems the only practical plan.

When it comes down to it then, it seems to me that there is value in stockpiling:

• enough water and way of staying warm for a month

• enough food to be comfortable for that month

• enough money and related alternates like silver and gold to last 2 or 3 normal months

But having anything more is not worth it for any doomsday scenario. Having stock to last years will likely mean that you will 'not live now' (stressing over and the cost of stockpiling) and 'not live then' (because someone will steal it from you.)

The only advantage I can see of stockpiling a lot of food and gold is this: Someone will shoot and kill you for it, so you die quickly rather than slowly, but you didn't have to commit suicide.

Personally, my faith, my trust, my 'banking' for that is not in gold or silver or food or banks or money but rather my security comes this way "all things work together for good to those who love God" (Romans 8:28 NIV) so the only logical, practical security is: Love God.

My use of gold and money and silver and stocks and bonds and TBils and bank accounts and raising animals and plants and running a company etc.., is all to be prudent in the current days, not as a way that I will survive a catastrophe while my neighbors don't.