By Bernie on 03 Jul 2012
Flickr User: The Lakelander
In response to my article Justice Roberts Calls President Obama an Incompetent Idiot, reader pjsymanski left this comment:
Interesting that the increase in the value of gold might make one rich.
I am no investment wizard, so it would be helpful to know this; if you sell your gold at an enormous profit, how do you invest the cash?
First, let's understand that being rich doesn't mean having lots of stocks, bonds, real estate and cash. Companies can go bankrupt and their stocks or bonds can become worthless. Real estate can not only become worthless but become a drain on your bank account. Cash can become so worthless that a wheelbarrow won't buy a pack of cigarettes.
To me, being rich means having a supply of resources so varied and abundant that one has the means to remain wealthy even in times of monetary chaos.
The purpose of precious metals ownership is not to earn profits but to preserve value. It is insurance against the government printing press or depression or hyperinflation. I do not buy gold to sell it at a higher price later. I buy in case. In case everything goes into the crapper. Recall the expression, "In the kingdom of the blind, the one-eyed man is king." Well, in times of chaos and uncertainty, he who owns gold is king.
I suggest that 10 percent of one's assets be in precious metals. If things remain stable and times are good, your 90% of other investments will make you rich. If things go awry, really, really awry, then the 10% in gold and silver will make you rich.
So in bad times I would not be selling gold for cash to put into other investments; I would be trading the gold for food, guns, shelter, protection and any other thing to keep me and my family safe and alive. When cash is worthless, a little gold would make anyone a rich and wealthy man.
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