Calling all gold bugs
- Thread starter No1joey
- Start date
My main issue in seeing new stackers come in is they have lost the whole point of stacking PM's.
They seem to think PM's are their vehicle out of poverty, whereas PM's are meant to be a store of wealth not the creator.
You need to have wealth before you stack so if anyone thinks PM's will actually buy them a house or retirement is insane.
The rich stack gold 'cos they have a lot of money and can afford to have 10% or 15% of their wealth just sit there, like an extension of their penis for their personal pleasure, they also drink $200 bottles of wine and pay $200 for 100 grams of food on a big plate at a french restaurant.
But for young people just starting out or anyone with a mortgage or working 9-5, this is the wrong caper. sorry but the only people making money here are the ones dealing in it.
Like most things, farmers don't make much and they grow stuff, yet the supermarket selling it makes a fortune, stackers are consumers, they bare all the losses, the retailers are the money for nothing club members.
They seem to think PM's are their vehicle out of poverty, whereas PM's are meant to be a store of wealth not the creator.
You need to have wealth before you stack so if anyone thinks PM's will actually buy them a house or retirement is insane.
The rich stack gold 'cos they have a lot of money and can afford to have 10% or 15% of their wealth just sit there, like an extension of their penis for their personal pleasure, they also drink $200 bottles of wine and pay $200 for 100 grams of food on a big plate at a french restaurant.
But for young people just starting out or anyone with a mortgage or working 9-5, this is the wrong caper. sorry but the only people making money here are the ones dealing in it.
Like most things, farmers don't make much and they grow stuff, yet the supermarket selling it makes a fortune, stackers are consumers, they bare all the losses, the retailers are the money for nothing club members.
I have no mortgage, but am saving toward increasing my deposit. Physical gold appeals to me more than numbers on a screen. Current inflation vs savings interest is not my first choice. At present, I'd prefer to keep stacking while the debt to income ratio for AU real estate is so high. If I'm lucky, at some point over the next decade prices will stagnate or fall, as income and gold rises. If not, I'll be a bit more patient and have a larger deposit and lower debt. Worst case scenario, my beneficiaries reap the rewards during their lifetime.
My super acts to diversify my portfolio, though I have some shares held personally. Not my favourite investment class, researching is time consuming, but better than bank savings.
Primary investment is toward equipment for business and self-education for self-sufficiency (e.g. build it, don't buy it. If you don't know how, find out). This investment is more work than gold, but I like it just as much. The process is meditative, and the rewards are both tangible and intangible.
My super acts to diversify my portfolio, though I have some shares held personally. Not my favourite investment class, researching is time consuming, but better than bank savings.
Primary investment is toward equipment for business and self-education for self-sufficiency (e.g. build it, don't buy it. If you don't know how, find out). This investment is more work than gold, but I like it just as much. The process is meditative, and the rewards are both tangible and intangible.
miniroo said:
$200 wine? Eww.
Stacker's don't bear all the losses unless you buy and sell up at the two worst possible times. Gold is not just a store of wealth but a great investment and it may just continue to out perform a lot of other investments too. Especially with the outlook on the future.
Stackers may bear losses even selling at the best of future times. Its just that stackers will lose less than everyone else. Maybe much less. Of course, if prices boom, patience will really pay off.No1joey said:
A great investment in what sense? It will only be a great investment if your investment objectives are met or exceeded. That is not a given. Wait till you offload.No1joey said:
Would you trust a gloomy bunch of pessimistic curmudgeons with their outlook on the future? Because that is what many stackers are (myself included).No1joey said:
SilverPete said:
I am not basing anything on a 'gloomy bunch of pessimistic curmudgeons'. I read and I observe and I predict. And the future for gold is great. You do realise that gold has outperformed the dow by more than 200% since 1970's. The only time stocks outperformed gold was during the tech bubble. So it's more than just a store of wealth. Gold is extremely versatile.
No1joey said:
Read about cognitive biases in investing, particularly Confirmation Bias and Negativity Bias.
No1joey said:
Gold Compared to Dow Jones Index
Dow Jones Index (DJIA) and Gold Nominal Prices
Gold went from $19 in 1900 to $1,110 in 2010 (times 58), while DJIA went from $61 in 1900 to $10,500 in 2010 (times 172). The first finding is that stocks investments are obviously more profitable then gold investments on the long-term. While gold average yearly return for the last 110 years was 4.91%, Dow Jones average yearly return was 6.07% in the same period. But there are periods in history, when gold strongly outperformed stocks.
Gold And Dow Jones Index Adjusted With Inflation
Dow Jones Index (DJIA) and Gold Inflation Adjusted Cumulative Returns
The point of second chart is to show you the difference between nominal and inflation adjusted growth. The thing is that prices of goods and services also rise over time and because of that, the buying power of one dollar today will be less in the future. Gold price did rose 58 times from 1900 to 2010 in nominal terms, but in real-terms, inflation adjusted growth was much lower, only 2.24 times. All the sudden gold investment doesn't look as attractive as it did before. In the same 110 years period from 1900 to 2010 the real growth of Dow Jones Index was times 5.76 (nominally 172).
Dow Jones Index (DJIA) and Gold Inflation Adjusted Annual Returns
The third chart focuses on Dow Jones Index (DJIA) And Gold Inflation Adjusted Annual Returns; gold scores 1.69% while DJIA scores 3.22% yearly. Another interesting fact can be read from the picture. The orange line, which is representing inflation adjusted gold market price, is mostly bellow the 0% line, meaning, gold growth rarely outperforms inflation; but when it does, it does it extremely. On the other side Dow Jones was a much better inflation hedge in 110 years history and it is not showing such extremes as gold market price.
http://www.stocks-for-beginners.com/gold-market-price.html
I own gold. I prefer silver. Neither provides a guarantee of future wealth. I'm not frustrated by it. Yes, I have hopes about the future price, but I also acknowledge that those hopes lead to cognitive biases so I try to look at both sides of the coin.No1joey said:
The frustration here seems to be with people who highlight the possibility that there may be no guarantee that gold will turn out to be a great investment. If it is painful to contemplate such a possibility then that is a warning that emotion may be overriding judgement and cognitive biases may be in play.
When there is an outcome that you strongly hope will come about, you will be able to find facts to fit that hope and discredit counter-facts. That's what cognitive biases are all about.... the filter through which you view the world.
SilverPete said:
Telling me to read up on cognitive bias? C'mon you are clutching at straws here. I think you just like to talk! 3000 posts in 9 months!
Everything is cognitive. I don't get your point here, are you not a stacker?
Anyway let's get back on the topic, the YES vote on the Swiss referendum will be great news for stackers try to spread the word and keep your fingers crossed!