Is Gold worth owning?

[LRDave]

Unless you are a manufacturer of some product in which Au is a component, no. It's just a metal with some interesting properties - good and bad.

 

[Big_Hitter]

Or the international equivalent of Beanie Babies.

are beanie babies a real asset? maybe

gold definitely is

 

[LRDave]

Gold is much closer to pork bellies than beanie babies.... and pork bellies usually end up as bacon, so win-win! :^)

 

[Fermion]

Gold will always have value. The same cannot be said of bitcoins, stock certificates, or even paper currency. The previous three may have a better return over a short period, and that short period could be many times longer than your lifetime, but gold has always had some value for the previous 5000 years.

 

[haha]

Or the international equivalent of Beanie Babies.

seems to have quite a bit more staying power.

 

[youbet]

No, gold is not worth owning. Please send all of yours to me; I promise to give it a good home.

Ha

Did you get my package?

 

[gerntz]

First, we have ~8% of our assets in GLD. Since GLD was founded in 2006, it's risen from $44 to $115. Au is not a not a commodity as it doesn't get/hardly gets consumed. It's always there. Net, I'd rather hold it than greenbacks - which keep getting printed nilly willy. Think of how much the US$ has risen vs. other currencies & yet Au still outperforms it. So just why would you want US cash or low pay CD's vs. Au? Now if you'd rather invest in something than hold cash, maybe you have something. Try thinking of Au as the standard instead of the USD and think of the USD as the commodity.

 

[eta2020]

First, we have ~8% of our assets in GLD. Since GLD was founded in 2006, it's risen from $44 to $115. Au is not a not a commodity as it doesn't get/hardly gets consumed. It's always there. Net, I'd rather hold it than greenbacks - which keep getting printed nilly willy. Think of how much the US$ has risen vs. other currencies & yet Au still outperforms it. So just why would you want US cash or low pay CD's vs. Au? Now if you'd rather invest in something than hold cash, maybe you have something. Try thinking of Au as the standard instead of the USD and think of the USD as the commodity.

I would rather own high quality equity that grows dividend faster then inflation rate like PEP or CL.

 

[calmloki]

My Mom owned shares of Rath Packing, which operated from 1891 to 1985. "Through two world wars, stock market panics, depression, and drought, the company had failed to show a profit in only four of its years". Their Blackhawk Indian chief emblem was omnipresent in any grocery meat and deli area. Pretty high quality stock. Then they went bust and weren't worth anything. Don't think that has happened to gold in like, ever? For hundreds or thousands of years?

Mom also had Enron through the bust, and we had GM and BofA. (can you tell we are real stock pickers?) All fine stocks until they weren't. Gold holds a different role in a portfolio.

 

[samclem]

My Mom owned shares of Rath Packing, which operated from 1891 to 1985. "Through two world wars, stock market panics, depression, and drought, the company had failed to show a profit in only four of its years".

The stock paid dividends 96% of the time? Gold pays dividends 0% of the time, right?

The true value of gold based on its utility (use to industry, etc) is a small fraction of its market value. The balance is due to very fickle demand based on . . .sentiment, habit, belief that another buyer will eventually be found at a higher price, whatever. But in many ways it is just as much a "fiat currency" as paper money.

 

[eta2020]

My Mom owned shares of Rath Packing, which operated from 1891 to 1985. "Through two world wars, stock market panics, depression, and drought, the company had failed to show a profit in only four of its years". Their Blackhawk Indian chief emblem was omnipresent in any grocery meat and deli area. Pretty high quality stock. Then they went bust and weren't worth anything. Don't think that has happened to gold in like, ever? For hundreds or thousands of years?

Mom also had Enron through the bust, and we had GM and BofA. (can you tell we are real stock pickers?) All fine stocks until they weren't. Gold holds a different role in a portfolio.

40 Bucks to $10 Million: What Warren Buffett Can Teach You - DailyFinance

She should had bought 40 Bucks of KO in 1919 and she would end up with 11 Million today .

I wonder what is value of 40 dollars of Gold from 1919. Is it 5000 bucks or 3000? Looking at some charts on internet looks to me like about 3000 bucks. And if you look at inflation from 1919 till today it very well may be that 40 bucks of gold from 1919 is worth just about 40 bucks in 1919 dollars today So one earned no real money in it.

But lets say we are not that smart. So we put money into S&P 500 Index. Well feed this into historical returns calculator and get ready for pleasant surprises.

http://dqydj.net/sp-500-return-calculator/

 

[unno2002]

For those contemplating “paper gold”, note that there is not enough physical gold on the planet to make good on all of the outstanding contracts.


For those contemplating physical gold, note that there are many reports of fake coins, bars, etc. Some of the best fakes have a tungsten insert with a thick enough gold coating that chemical tests show the gold to be real. I’ve read of large dealers and even banks being scammed with these fakes. It would be difficult for an individual to be certain of what they are getting.


Diverging, I understand that even US “juke silver” coins have been faked.


So, opinion, I used to think some gold or silver would be a good investment against prospective high inflation, but I gave up on the idea.
_______________________

 

[gerntz]

I would rather own high quality equity that grows dividend faster then inflation rate like PEP or CL.

For the equity part of my allocation, me too.

 

[gerntz]

For those contemplating “paper gold”, note that there is not enough physical gold on the planet to make good on all of the outstanding contracts.

By "paper gold", do you mean ETF's backed by physical gold ounce for ounce, or options? Agree with you on the latter. Those are the primary cause of so much volatility.

 

[eta2020]

For the equity part of my allocation, me too.

I allocate 100% of my money to equity. At age 50 no regrets so far.....

 

[haha]

The stock paid dividends 96% of the time? Gold pays dividends 0% of the time, right?

The true value of gold based on its utility (use to industry, etc) is a small fraction of its market value. The balance is due to very fickle demand based on . . .sentiment, habit, belief that another buyer will eventually be found at a higher price, whatever. But in many ways it is just as much a "fiat currency" as paper money.

Except that its supply is constrained. Also, dollars are a proven loser over time, gold is so far and for long time, a proven winner. Not a moon shot, but not bad.

Ha

 

[haha]

Diverging, I understand that even US “juke silver” coins have been faked.
_______________________

You mean junk silver?

 

[CoolChange]

Except that its supply is constrained. Also, dollars are a proven loser over time, gold is so far and for long time, a proven winner. Not a moon shot, but not bad.

Ha

Similar to my thoughts on gold. My PM exposure (currently just gold but considering adding silver) is basically insurance/ballast in my portfolio: An annoying drag on performance when everything else is hitting on all cylinders but hopefully protective if the markets and/or dollar take a nosedive, inflation ticks up significantly, etc.

For myself, I do not physically take possession but use GTU fund.

 

[Totoro]

Gold as a proven winner?

It was for five short years in the late 70s and early 80s. Then a big fat loser until 2002. The last ten years it was back in business. Recently, not so much.

Gold Price History

and in real terms:
Historical Gold and Silver Prices - 100 Year Chart | MacroTrends

All of that gold is still in inventory. And some of its value is cultural buying by Indians (dowry) and Chinese.

Might as well invest in lottery tickets and hope you hit it big (my not so humble opinion).

 

[gerntz]

I allocate 100% of my money to equity. At age 50 no regrets so far.....

Good for you. I have no regrets owning GLD.

 

[gerntz]

Gold as a proven winner?

It was for five short years in the late 70s and early 80s. Then a big fat loser until 2002. The last ten years it was back in business. Recently, not so much.

Gold Price History

and in real terms:
Historical Gold and Silver Prices - 100 Year Chart | MacroTrends

All of that gold is still in inventory. And some of its value is cultural buying by Indians (dowry) and Chinese.

Might as well invest in lottery tickets and hope you hit it big (my not so humble opinion).

Your charts show holding gold is way better than holding cash & by inference, low interest CD's. I don't see your point.

 

[Dash man]

Gold is a hedge against a financial crisis such as the collapse of the dollar. Not so much as an investment.

 

[Rothman]

No gold is not a safe hedge in my view, it's more of a speculative alternative currency play. Gold has some industrial use like other metals but that is such a small part of the demand it's not really consequential in valuation.


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[gerntz]

No gold is not a safe hedge in my view, it's more of a speculative alternative currency play.

Good way to look at it. Doing so thus makes holding US currency/fractional % interest rate CD's/bonds way more speculative since 1975.

 

[Empresario]

There could be a time when owning some gold could be quite useful. Same can be said about land. Some very caution folks probably own gold, land, munitions, etc. And. They may ultimately be the wise ones. I do not own gold.


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