Thread: Gold Buying
View Single Post
  #74  
Old 19.09.2010, 11:41
marton's Avatar
marton marton is offline
Forum Legend
 
Join Date: May 2008
Location: Kt. Zürich
Posts: 10,554
Groaned at 470 Times in 403 Posts
Thanked 19,349 Times in 10,216 Posts
marton has a reputation beyond reputemarton has a reputation beyond reputemarton has a reputation beyond reputemarton has a reputation beyond reputemarton has a reputation beyond reputemarton has a reputation beyond repute
Re: Gold Buying

Quote:
View Post
I don't see their being a cost in keeping physical gold except ones annual Chf 32 cost for a safety deposit box in Switzerland. One could even argue that if you don't declare it on your Swiss Tax Return, you save Wealth Tax.

What would be interesting to see is the amount of ETFs issued for gold against actual physical gold.
This makes me think that there will not be an issue regarding gold bought by Investment funds as they appear to be mainly holding ETAs.

Gold ETAs is where I expect the disaster to come. It could be a bit like the "Money is Debt" scenario.

Once the Quantitive Easing starts again (inevitable in the USA), the price of gold will surely go up.
But is the price of gold going up or the dollar value going down and hence more dollars required to buy the same lump of gold if you compare the price of gold to say the Swiss franc over the last five years?
Note how 5 year increase in price in US Dollars is 177% while in Swiss Francs only 121% becuase the value of the dollar has fallen against the Swiss Franc basically.

Silver has increased at a higher rate than gold of recent.
I would still think Gold would be a better buy than Silver as less of the physical stuff and known as the metal to have in the common world.
About "the amount of ETFs issued for gold against actual physical gold."
I read somewhere that the amount of gold based paper around is about 100 times the amount of physical gold. Sounds like a disaster waiting to happen

About "is the price of gold going up or the dollar value going down" you need to define what you mean by the price of gold.
If you mean the price in Swiss francs then over the last year it has risen about 25% but in the last 3 months it has fallen by about 10%. So if you had sold the gold that you bought 1 year ago about 3 months ago then you would have been about 35% up (all round figures).
So basically the answer to your question is both. The price of gold is going up faster than the dollar is going down when averaged over 1 year.

Buying gold today with us$? may well be a good idea.
Buying gold today with Swiss Francs? dunno' !
Reply With Quote