THE PROOF THAT GOLD PAYS INTEREST Peter Souleles B. Com. LLB. 16 June 2011 Statements are sometimes repeated to the point that they acquire the status of truth despite being deceptively false. In my mind I am undecided as to whether the greater morons are those that make such statements or those that accept them. The statement that "gold pays no interest" is one of the finest examples of intellectual bankruptcy and dishonesty. https://www.ainsliebullion.com.au/R.../68/language/en-AU/Default.aspx?articleid=251
YKY - What ya doing looking at Au articles? Have you gone to the other side? Silver pays interest too ya know...
Withdrawing value from capital appreciation is not interest. This works great in a bull market. Interest is steady, boring returns. Gold pays no interest, and for that matter neither do the paper (plastic) notes we carry around. What generates interest is the act of putting capital at risk, or lending it for some purpose. While most people today lend their notes to the bank. It is still 'at risk', and you generate interest. I understand the authors viewpoint and concede that it would have worked beautifully the last 11 years, however in a true sense you are not 'generating interest'. You are drawing down your capital. Your initial $100,000 invested in year 1 would have bought around 400oz. By the end of year 11, you only have around 250oz left. (using $250oz price in 2000, and $1500 price in 2011)
gold can produce all kinds of derivatives, if your imagination in financial engineering is good. even without gold, you may get gold, but with gold = products of wonders ! the hearts and minds of people to agree and disagree = priceless, should i say goldless.
exactly my point also. To be honest a little shamed that such an article would appear on a dealers website. I would have thought them more intelligent than that.
Gold does pay interest.. in Vietnam anyway (possibly other counties also). What ever amount of gold you put in to the bank you earn interest on its value. Im not sure if all banks offer this over there but some do. I know this was available last year but with all the laws about gold changing recently it might have been abolished.. not too sure.
I think this only proves that SOME PM dealers can be as unethical/dopey/gullible as real estate marketers. Same sales pitch as many a property spruiker - unbelievable. You could probably argue that it is more ethical coming from a real estate guy going on the fact traditionally real estate is less volatile but even still.......... malachii
take inflation into account in your calculations, note it doesnt effect gold but every other fiat based investment, suddenly the picture becomes clearer.
Using a different definition of "interest" to the one everyone else uses just to make the point that gold is a good investment is dumb. Gold is a decent investment even without it earning interest. It is what it is. That's one of the things that makes it different to other asset classes.
Youve lost me. I said that gold doesnt pay interest. Fail to see how allowing for inflation changes this view
