(A) The "traditional myths" about gold:-
1. Investing in gold always pays off.
2. Gold is totally safe.
3. Gold prices can be guessed from global economic trends.
4. Gold is a hedge against inflation.
5. Buying gold jewellery is an investment.
6. Gold and equities move in opposite directions.
(B) The "hard facts" about gold:-
1. Gold is a way of going long on fear.
2. If people/nations become more afraid, you make money, if they become less afraid you lose money, but gold itself doesn’t produce anything.
3. What motivates most gold purchasers is their belief that the ranks of the fearful will grow.
4. It’s a lot better to have a goose that keeps laying eggs, than a goose that just sits there and eats insurance and storage, etc.
5. Gold is not safe – government debt is.
6. It only appears safe because it is compared to equities.
7. The historical volatility of gold prices means that they also go up or down, which is not safe by any means.
9. Gold prices are affected by asset class-specific factors, particularly supply and demand, which is very difficult to understand.
10. The Consumer Price Index (CPI) has very little to do with gold.
11. Jewellery and coins have personal and cultural worth, and store value.
12. They do not provide either regular income or true liquidity.
1. Investing in gold always pays off.
2. Gold is totally safe.
3. Gold prices can be guessed from global economic trends.
4. Gold is a hedge against inflation.
5. Buying gold jewellery is an investment.
6. Gold and equities move in opposite directions.
(B) The "hard facts" about gold:-
1. Gold is a way of going long on fear.
2. If people/nations become more afraid, you make money, if they become less afraid you lose money, but gold itself doesn’t produce anything.
3. What motivates most gold purchasers is their belief that the ranks of the fearful will grow.
4. It’s a lot better to have a goose that keeps laying eggs, than a goose that just sits there and eats insurance and storage, etc.
5. Gold is not safe – government debt is.
6. It only appears safe because it is compared to equities.
7. The historical volatility of gold prices means that they also go up or down, which is not safe by any means.
9. Gold prices are affected by asset class-specific factors, particularly supply and demand, which is very difficult to understand.
10. The Consumer Price Index (CPI) has very little to do with gold.
11. Jewellery and coins have personal and cultural worth, and store value.
12. They do not provide either regular income or true liquidity.