To say this has been one hell of a week in the markets so far is an understatement. I do not recall which of the bubblevisions I was unfortunately trapped into listening to, but I distinctly remember hearing the discussion as to why gold was a terrible hedge against inflation compared to equities once again.
It reminded me of just how insane that line of thinking in the past year has been thus far.
So if one is to believe the talking heads and many of their guests, the 15% or so return on one’s money is much better than the “hedge” which has produced a return of 43.45% over the same time period. While math might not be my strongest subject, linear and logical analysis certainly is, thus 43% is still higher than 15% unless I’m completely delirious.
In fact, gold over the past five years has provided nothing but solid returns while remaining the only real offset of the Federal Reserve’s, along with other central banks, insane monetary policies.
Regardless of this, the mainstream media continues to push the narrative that gold ownership is for eccentrics, kooks, survivalists, or doomers who live in lead clad homes with five years of survival food stored for when eggs are poisoned by the New World Order.
Scratch that last sentence, sort of.
On a more realistic viewpoint, it’s each individual’s personal responsibility to determine if a mix of precious metals in one’s portfolios is wise. If you’re young and believe that inflation will never be a factor ever again in ten years, decide accordingly. However, I wish I had listened to my gut and stocked up on gold coins from the mid-1990s until mid-2000’s when the price was over $2500 lower.
This old guy’s advice?
Do not let the propaganda scare one away from investments in gold or silver. The specter of being un-hedged against sustained periods of inflation due to government and/or central bank incompetence is too risky if one thinks about what has happened since the 2007-2010 GFC. Think about obtaining the security of historically real money versus out of control monetary inflation.
Or face the haunting prospect of depending on a central banker to determine what few assets one holds are really worth. The specter of personally obtaining in and investing in precious metals requires discipline and the ability to be personally responsible for one’s own finances. Just remember that a fiat currency regime is not a democracy, and one does not get a vote in how the powers that be determine what one’s assets other than gold are really worth.
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