I keep reading stories/rumours about a big shortfall in customer funds at MF Global so many people will not get their money back including people who had their gold stored by MF Global.

Anybody know more about this? I mean will people lose their gold (paper versions)?

It is a real possibility. The safest bet is to physically own the bullion and store it in a safe deposit box where the bank can only be the custodian.

Unless, of course, you have government confiscation of gold (like in the US in 1933). BTW, if Obama decides to confiscate gold bullion, this would probably apply to US entities abroad also; I wonder how other countries would react to this (gold controls)?

ftfy

There are people (notably Doug Casey) that suggest you stay away from banks but rather go for a security company storage solution. The idea is that anything in a bank is easy for the government to get at. The idea of home storage is not really recommended especially with the possibility of home invasion (yes there are cases even here in CH).

I think that with the "Cyprus case", we can safely say: everything is possible. Confiscation of gold bullion in bank-vaults included. And we have definitely *not* "seen it all".
That said: home invasions are quite common here. And when you hear that it nets the criminals, 50, 80 or 100k in cash, gold-coins and jewelery, it's no wonder criminals continue to do it.

Apparently (they claim) that one of the difficulties of managing gold owned as paper gold is that people tend to buy paper in round numbers; say $10K. But there is no metal equivalent of $10K; so nobody wants to start cutting up metal bars & how do you manage to physically restore a metal bar that has multiple part owners?

I guess you will be able to pick up gold bars at sometime in the future for 10k, it's just a matter of when! Every cloud has a silver lining!

You can only take delivery for full bars, AFAIK. A full bar is 400 ounces.
http://en.wikipedia.org/wiki/Gold_bar
I would assume, the fine print of the ETF makes this very clear...

Well said!
Everything we 'know' about banks and 'laws' will have to be repeatedly revised in the coming years - a sort of on-going mental exercise. Things are going to change and change repeatedly and sometimes rapidly. Don't trust anyone least of all the 'authorities'.

I think you miss the point?

I was talking about MF Global.
For example, you are a customer of MF Global and have a paper certificate worth one gold bar (size does not matter). Now suppose MF global lost one third of their customers money. You now own two thirds of a gold bar. I do not think fine print will recover your money.

It's certainly the worst investment over the long term http://www.joshuakennon.com/stocks-v...ast-200-years/

Interesting but where is the source of the investment 200 year period?

Take a look here
http://onlygold.com/tutorialpages/prices200yrsfs.htm

Interestingly 1832 $19.39 to 1932 $20.67

With 98 years 1834-1933 price both $20-67

It's a bit like 'house prices never fall' & 'it's different this time'

What I had not appreciated is quite how volatile an investment Gold has been since 1972, rather like owning 1 stock rather than a balanced portfolio. Quite amazing it's considered a 'safe investment'.
http://onlygold.com/tutorialpages/PicesSince1972FS.htm

Do you not think the main principle of capitalism is about taking risk if you want a healthy return.
Obviously Value at Risk (VaR) must be carefully srutinized before such lucrative ventures.

Sure, but gold is often described as a currency so movements of +/- 50% in a year V USD seem extream.

gold still having a bad time...

HaHa so gold closed at $1230.50, the little people who bought high are now selling, where is the floor $1000, $800. $500 or $300 this will be fun to watch!

Will be also interesting to warch the so called experts disappear from sight as they realise the predictions of it being safe are false and only hold true until confidence in actual currenicies returns. Gold is absolutely not a safe investment and only worth touching if you know the market otherwise its riskier stocks

I wouldn't write gold off so quickly. There are reasons why the price is going down — not everybody is selling, and many of those who are selling, are selling "paper" gold, not physical gold (there's a meaningful difference).