View Single Post
      08-20-2019, 07:18 AM   #102
Run Silent
Run Deep
Run Silent's Avatar
United_States
15127
Rep
4,123
Posts

Drives: Back and Forth To Work
Join Date: Mar 2017
Location: The Mountains

iTrader: (0)

Garage List
Quote:
Originally Posted by Fritzer View Post
Don't come crying when you stocked up on USD in your bank account and it's inflated even more when the next recession hits!!
No. Just no. If the world is so bad that the USD has collapsed, you should buy food, guns, and water - not gold.

Quote:
Originally Posted by qba335i View Post
Gold can be a very good/profitable trade. Gold/msci world has a pretty nice set up.
No again. Just no. It is in my professional opinion that gold is a terrible investment.

I have to go on this rant every year or so - so here you go:

Personally, I’m not a believer of precious metals as an investment. It’s a commodity, which translated means it creates no revenue. I invest in things that create revenue.

Bricks don’t create revenue, so I don’t buy bricks. I don’t buy cloth. I don’t buy commodities, and I don’t buy little gold or silver bricks either. The point is that the only thing which drives the market price of gold is demand. The only things that drive demand for gold are greed or fear. People feel like the price is going to go up, so they jump in. Greed might be too strong a word, so it might be speculation. You are estimating people’s emotions. That’s all that drives commodities because gold does not create revenue. The only way gold goes up in value is if more people want it. If less people want it, it goes down.

The gold thing is driven by fear, versus if I buy a piece of real estate. If I buy a $300,000 rental house, it will make me a certain number of dollars in rent. I have the rent, which I can analyze and say that if I do my job as a landlord and fill up the property, then that investment will create revenue. It’s not a brick. It creates revenue and it has the future to create revenue. It can also go up in value in addition to that. Some people are also speculating in gold, which would be on the greed side, or the profit motivation side. It’s fine to speculate in things if you want to, but I don’t like markets where the result is based on the quality of something that is not going on.

If I buy mutual funds, which have stocks in them, that creates revenue. If you do an analysis of Apple or DuPont or HP or McDonald’s or Home Depot, where you can analyze the level of debt they have, the growth level they have, their sales, profit-earnings ratio, you can look at those numbers and determine that the stock is going to go up and be worth more. It is predictable based on the math. It is not based on someone’s whim. Yes, on someone’s whim, that company could be mismanaged, but it’s pretty safe to say that Apple will be all right for a while. I buy in good growth stock companies in good growth stock mutual funds. But that’s an analysis of numbers; I’m not buying a brick, I’m buying cash. I put cash out and I get cash back.

In this case, you put cash out and you own a brick. Then you wait to see if fear drives the price of the brick up. The instant there is less fear, the price of the brick will come down. Gold has a horrible track record. Here’s another hint: If your investments are advertised right after a Snuggie ad, you are probably not in a good category of investments.

If Snuggie is on, and then right after that, catheters and then gold coins, something is wrong. Some people might say that real estate is on there, but it’s get-rich-quick real estate, which I don’t advocate at all. But owning real estate does make sense.

/Rant.
__________________
Don't sweat petty things....or pet sweaty things.
Appreciate 4
vreihen1614900.00
ASAP10054.00