The whole mantra that gold is a safe haven is a load of bullshit.
Look at the goldbugs on here for an example of how blinded some people are. They spout pages of froth about how the global economy is plummeting and it's all fucked and it's never looked worse.
And what has gold done in the face of "things have never been worse"????
It's not a safety net at all.
Let's look it another way. Global equities in the world's 3 largest economies and property values in the main centers of the carry trade countries are on a tear. Based on your logic, gold is behaving exactly as it should.
Just curious, Shadow: if/as/when a substantial Australian RE price reversal actually does occur, what is your prognosis for the AUD gold price then?
I don't have one. There's no relationship between Australian house prices and gold. Gold could do anything.
To me, it is pointless holding gold since it has no yield. It doesn't do anything. You can't leverage it or borrow against it. It just sits there shining prettily while the owner hopes and prays for the price to go up. Not that it matters, because regardless of whether the price goes up or down, most goldbugs just keep on hoarding it. Most will die with their little hoard still intact, it having provided them with zero benefit during their lives. Other than its role in industry/jewellery/electronics etc., gold is completely useless as an investment.
I don't have one. There's no relationship between Australian house prices and gold. Gold could do anything.
To me, it is pointless holding gold since it has no yield. It doesn't do anything. You can't leverage it or borrow against it. It just sits there shining prettily while the owner hopes and prays for the price to go up. Not that it matters, because regardless of whether the price goes up or down, most goldbugs just keep on hoarding it. Most will die with their little hoard still intact, it having provided them with zero benefit during their lives. Other than its role in industry/jewellery/electronics etc., gold is completely useless as an investment.
Depends on what universe you live in. If you really want to leverage gold, just hustle your scrawny behind into CFDs. As an investment, it can do very well thank you very much. Creating stereotypes doesn't diminish these tangible realities. Even a buy and hold of GOLD ETFs back when it was first listed on the ASX would have done very well thank you very much. For pushing a few buttons, it's been a fantastic return for next to no effort or cost, but mainly for people who don't need to rely on leverage to make their lives rich and fulfilling.
Investment, LOL. You mean speculation (no yield). Anyway my post was about holding gold, not some esoteric 'financial instrument' visible only on a computer screen. I'll leave those to the advanced speculators such as yourself. I prefer assets that provide an almost guaranteed income stream, and that have an actual physical presence.
The whole mantra that gold is a safe haven is a load of bullshit.
It's not a safety net at all.
Is it ???? Why do central banks all around the world hold it ? Banks ???
That worthless relic that banks hold. What do banks hold ? Money. The money recognised worldwide, in any country, in any language for thousands of years.
Real money.....
Real money is not printed from a machine. Paper money was merely a substitute for gold at one stage, written on the note was the promise to pay the bearer in gold coins on demand from the government for the amount shown. The ONLY thing that gave that note ANY worth was the government promise to pay the bearer in gold coins on demand. Otherwise this was just a worthless piece of paper, backed by nothing whatsoever, just like monopoly money. Australian notes in the 1920s has the same thing written on them, to pay the bearer in gold coins on demand.
You see, it costs next to nothing to print money, just a printer and something to print on. It costs the same to print a one dollar note as it does a 1000 dollar note, and no difference in effort. But the difference between a one ounce gold coin and a one thousand ounce gold bar is all the hard work and effort it took to get that one thousand ounces as opposed to one. All that hard work to discover it, to mine it, to refine it, to mint it, all the worth is embedded in that coin.
We used real gold coins here in Australia up until the early 1900s too.
One day you might understand ,just like you did iron ore.
Nixon here below in despersation in 1972. This below was the final nail that has led to arrival of the gfc, as things eventually became unsustainable by any means, and why US house house prices are cheaper than they were ten years ago, despite zero rates for seven of those years and where their population has risen by 25 million over the last ten years. When you cant pay your bills desperation follows. Nixon knew back here US j9bs were not being taken for the first time in history. The thriving motor industry of the 50s and 60s was dying. Other nations with cheaper wages like the euro or japan were building new products and cars to rival the US industry and economy. Detroit was the motor capital of the world. We all know what happened to prices there. While zero rates have seen prices risensome 40% from there lows, they are still a fraction of what they once were and are now the same price as 15 years ago. Detroit once had the highest wages per capita in the world. It now reasembles closer to a third world now with poverty riffe. Nixon could see the decline back then when he was giving the speech below in 1972.
Investment, LOL. You mean speculation (no yield). Anyway my post was about holding gold, not some esoteric 'financial instrument' visible only on a computer screen. I'll leave those to the advanced speculators such as yourself. I prefer assets that provide an almost guaranteed income stream, and that have an actual physical presence.
OK. Gold is for speculators. I can live with that. And so can many other people. Perceptions are simply that are and largely irrelevant. But even then, if you had dumped money on gold when the ETF was first launched in the ASX, that is similar to buy and hold. You'd be up around 160%. Not bad, if you don't rely on leverage and don't require an income stream to make that leverage work for you. Effort involved is miniscule and quite satisfying. If people consider that an inferior investment, we're living in a surreal world.
I don't have one. There's no relationship between Australian house prices and gold. Gold could do anything.
To me, it is pointless holding gold since it has no yield. It doesn't do anything. You can't leverage it or borrow against it. It just sits there shining prettily while the owner hopes and prays for the price to go up. Not that it matters, because regardless of whether the price goes up or down, most goldbugs just keep on hoarding it. Most will die with their little hoard still intact, it having provided them with zero benefit during their lives. Other than its role in industry/jewellery/electronics etc., gold is completely useless as an investment.
As my forum name suggests I am not a goldbug but I do hold some physical gold – 6 bars in all. Indeed they have no yield but they are beautiful to look at. A bit like a valuable piece of artwork, which also has no yield.
As time goes by the value of my ‘hoard’ goes up and down but I don’t pay much attention. If I don’t need to ‘use it’ in my lifetime that is actually a good thing because it will mean that despite all the prevailing doom and gloom the economy will not have gone belly up and off the rails.
And after I’m gone, if my ‘hoard’ remains intact it will be distributed to my three children – 2 bars each. I would be doing the same if I had a valuable art collection instead (which I don't because I know sweet f… all about art).
So you've got nuthin' except go long on real estate?
I've already got a PPoR, a longterm hold.
The question I posed to Shadow was: "if/as/when a substantial Australian RE price reversal actually does occur, what is your prognosis for the AUD gold price then? Is it a potential hedge against negative RE price movements?"
No answer yet. It doesn't sound like your advice is a hedge, it's more like a blind "ride it out eventually" thing.
You asked for a hedge against a real estate downturn and I told you my answer. If you cannot understand it that is your problem.
Gold is good for jewelry and despite what people might try to tell you it is no longer used as a currency. There are people who buy gold in downturns and if you are lucky you can sometimes profit from their fears as they act out their delusions and bid up a gold ponzi. Good luck on timing of buying and selling. IMHO you are better to leave gold alone and hold onto your property through a downturn.
Kuyuss
18 Mar 2015, 10:54 PM
Depends on what universe you live in. If you really want to leverage gold, just hustle your scrawny behind into CFDs. As an investment, it can do very well thank you very much. Creating stereotypes doesn't diminish these tangible realities. Even a buy and hold of GOLD ETFs back when it was first listed on the ASX would have done very well thank you very much. For pushing a few buttons, it's been a fantastic return for next to no effort or cost, but mainly for people who don't need to rely on leverage to make their lives rich and fulfilling.
You may indeed have done well and profited from the ponzi run but it has left a bad taste in the mouths of those who did not. So I would not think people will get on board another gold ponzi for a long time.
Definition of a doom and gloomer from 1993 The last camp is made up of the doom-and-gloomers. Their slogan is "it's the end of the world as we know it". Right now they are convinced that debt is the evil responsible for all our economic woes and must be eliminated at all cost. Many doom-and-gloomers believe that unprecedented debt levels mean that we are on the precipice of a worse crisis than the Great Depression. The doom-and-gloomers hang on the latest series of negative economic data.
You may indeed have done well and profited from the ponzi run but it has left a bad taste in the mouths of those who did not. So I would not think people will get on board another gold ponzi for a long time.
You talk emotive gobbledygook and are totally clueless Timing is everything with almost any type of investment. If the timing is wrong mistakes can be made buying investment properties as well as buying gold. That doesn't mean gold is a ponzi but if you insist it is then your argument should also be applied to investment property.
Definition: A Ponzi scheme is a fraudulent investment operation where the operator, an individual or organization, pays returns to its investors from new capital paid to the operators by new investors, rather than from profit earned by the operator.
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