Tuesday , 16 April 2024

GOLD: The World’s Best Kept Investment Secret

The world’s best kept investment secret is GOLD:

  • Gold has gone up 7.5X this century
  • Gold compound annual return since 2000 is 9.2% while the Dow Jones compound annual return since 2000 is only 7.7% incl. reinvested dividends
  • so why are only 0.6% of global financial assets in gold? The simple answer is that most investors don’t understand gold because governments suppress the virtues of gold.

This version of  the original article by Egon von Greyerz has been edited and abridged by the Managing Editor of munKNEE.com to ensure clarity and brevity for a fast and easy read.

Has anyone ever heard a Western government tell their people:

  • that gold is the best protection against their government’s total mismanagement of the economy and their currency?
  • that, since 1971, their currencies have declined by 97% to 99%?
  • that in the next 50-100 years their currency will lose another 97-100%?

Obviously, no government would ever be elected if they told their people the truth that the economy and their money will continue to be mismanaged and destroyed like it has throughout history.

Why don’t:

  • …journalists study the history of money and educate the people?

The answer is obvious; journalism is just government propaganda and there is not a serious investigative journalist around today.

Why doesn’t:

  • the investment management industry neither…study nor understand money?

Why? Because it doesn’t serve their purpose.

  • It is better to create a mystique around a mediocre industry that, on average, underperforms the market.
  • It ….doesn’t allow them to churn commission which is important for their survival…

DRIVERS FOR GOLD

In this 12 minute video extract from a Palisade Radio interview below, I discuss the drivers for gold. In summary the important drivers discussed which will soon propel gold to much higher levels are:

  • Global deficits & debts – US, Europe, China, Japan, Emerging markets
  • War
  • Social unrest
  • Gold buying by BRICS countries
  • Central bank gold purchases of gold due to move from Dollar reserve assets to Gold

GOLD IS THE BEST WEALTH PRESERVATION ASSET THROUGHOUT HISTORY

  • Gold is not an investment. It is nature’s money and thus the only money which has survived in history.
  • Governments and Central Banks are Gold’s best friend. Throughout history they have without fail destroyed the value of fiat money while Gold has maintained its purchasing power for thousands of years.
  • As I discuss in the interview, risk is greater globally today than at any time in history and Physical Gold is the ultimate protection against such risk.
  • For wealth preservation purposes Gold must be:
    • held in physical form with direct access by the investor,
    • held outside a fractured financial system. No use holding your gold in the system that you are protecting against and
    • held in a safe jurisdiction outside your country of residence and especially outside the U.S., Canada and the EU.
  • NEVER, EVER hold gold in paper form or ETFs.
  • the allocation to physical gold and some silver should be at least 25% of your financial assets and potentially much more. Gold and Silver are not just for the wealthy. You can buy 10 grams for $70 or one ounce of silver for $25 and
  • NEVER worry about the gold price. Governments will continue to devalue your fiat money and thus revalue gold as they have throughout history.

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