I’ve been hearing radio ads for gold for some time now. The basic premise and message is something like
The dollar is going down the tubes. It’s lost 40% of its value in the last few years, and we’ll be facing massive inflation soon. You need to own GOLD! Buy our GOLD COINS NOW!
What do they want you to buy the gold coins with? Your dollars! That’s right! The dollar is such a lousy investment to have that these companies will take it on themselves to burden themselves with *your dollars* to give you access to those oh-so-valuable GOLD COINS!
Whatever.
If the economic woes of the past few years have taught us anything is that very little of anything has any intrinsic value (food? basic shelter?) Value is defined as what all concerned parties agree on – nothing more. When everyone stopped believe in tech stocks, they didn’t have any value. When everyone stopped believing in the myth that “real estate always goes up”, it stopped. Yes, I’m simplifying this perhaps more than I should. Someone will fight me regardless of how detailed I went anyway. Flame away.
Having gold coins will only be valuable as long as everyone agrees that they’re valuable. If people stop believing that gold is valuable, it will be worthless.
If society collapses, precisely two things will have value: 1) food, and 2) ammo.
Assuming society isn’t collapsing, gold is a just fine investment. Although why you’d buy the actual things (and risk physically losing them) when you can buy into it on the commodity market is beyond me.
Yet, gold has had great value for a long long time, thousands of years… that’s a pretty good track record and I’d feel confident in making that investment.
The companies selling the gold is making profit from selling it at an inflated price. If you purchase gold or silver in “bulk”, you get a much higher value. The difference between CostCo/Sam’s Club versus a QuickieMart/7-11. Soda and milk have the same value, yet profits of the items are different relative to where it is sold and how much is sold.
Gold is actually one of the safest investments one can make, and gold is _real_ whereas investments and money in the bank are virtual (you could lose it all in a day without ever holding a penny of it in your hand).
If you’re going to invest in gold, do it in bulk, otherwise you might as well just get a savings account.
Also profit comes in from people not knowing the relative value of gold and will buy what is offered to them, and not research. Notice who they are marketing to.
They are marketing to mostly right-wing conservative talk radio listeners, as far as I can tell.
Sure gold is “real” as in physical, but so what? Paper dollars are real, but they’re only useful if everyone agrees on some common value for them.
I just thought the appeal in the radio ads was really dumb. “Dollars are losing value – give us your dollars!” Few other things would be marketed that way.
If there’s a big economic collapse, gold won’t have any real value either. Obviously I can’t guarantee that, but it seems to me that whatever the ‘old rules’ of economic theory have been, they’re not all going to remain constant. People all fled to real estate looking for a safe haven after the dotcom crash. Enough people all believed in the ‘value’ of real estate for a few years, then stopped. People can just as easily stop believe in the “value” of gold. Am I a crackpot? Maybe, but I don’t think so
If there’s a big collapse, food, clothing, shelter, water will have much more value to people than pieces of gold.