Special to Half Moon Bay Memories and El Granada Observer.
It was a hectic week for Gold.
The yellow metal was the lead story in the NY Times Business Section on Wednesday, November 19 and I was interviewed on the KGO 6 O’Clock News on Thursday.
The reason for all this hoopla?
The price of an ounce of gold went over $500 for the first time in over 20 years. (At the market close on Friday, Dec. 2, gold was trading at $504.50).
People are mystified by gold. They may revere ornaments produced by the Goldsmith (the gold wedding band is one of the most potent symbols in our culture), yet the notion of holding gold as an investment, or as part of one’s savings is clearly out of mainstream thinking.
It has been said that there are only 6 people in the world who understand Gold and that they have 7 different opinions. Well, let me try to “demystify” the subject, and, perhaps, persuade you to consider acquiring some beautiful gold coins.
First: Here are some of the “negatives” concerning gold ownership.
Gold doesn’t bring any return like a bond or stock. Also, storing gold could be dangerous and costly. The “crooks” love it and Safety Deposit Box fees at Banks are on the rise.
The “King” doesn’t like gold; he never has and never will. If you own a share of IBM stock, you are a patriot; own an ounce of gold and there is something wrong with you.
If someone wants to sell gold, it might prove difficult to find a buyer.
The government could confiscate gold as it was in 1933.
Some of the negative statements above are pure propaganda. Here are the immutable truths:
Gold and silver have been “money” in much of the world for almost 3000 years. By its nature, gold prevented the Kings and tyrants from increasing the supply of money whenever they wanted to. (As they do with paper).
It served as money in our own country from the beginning, the (1790s) through 1933 when it was demonetized. FDR’s first Executive Order in 1933 required Americans to bring their gold coins to the bank to exchange them for paper. They called it demonetization of gold, but it was outright theft.
Led by the US, the world has been off the god standard for about 75 years, yet every country retains gold as part of their national wealth.
Restrictions on Americans to hold gold ended in 1974.
If one has gold to sell, Iwould argue that there is nothing else they own that would be more liquid.
“Only Government can take commmodities as valuable as paper and ink and make them worthless.”
“When all the paper money is dust, gold will be of value.”
Yes, those quotes are pretty strong, but a prudent investor should own some gold.
Who knows, the next time KGO wants to interview me, it will be when gold exceeds $1000 per ounce.
Burt Blumert is a leading gold dealer (almost 50 years) in the San Francisco Bay Area. You can send him email at [email protected]