Comments on: Gold Is A Lousy Investment http://livingoffdividends.com/2009/11/16/gold-is-a-lousy-investment/ Join me on my journey to achieve financial independence through dividends, passive income and investments Tue, 16 Mar 2010 21:22:11 -0700 http://wordpress.org/?v=2.8.1 hourly 1 By: Welcome to GoldInstitute.net » Posts » The Allure Of Gold: Now And Through The Ages http://livingoffdividends.com/2009/11/16/gold-is-a-lousy-investment/comment-page-1/#comment-86883 Welcome to GoldInstitute.net » Posts » The Allure Of Gold: Now And Through The Ages Wed, 17 Feb 2010 10:58:36 +0000 http://livingoffdividends.com/?p=1352#comment-86883 [...] price rise four-fold over the past decade and with substantial gains in all currencies (while outperforming every other major asset class), gold is resuming its historical monetary [...] [...] price rise four-fold over the past decade and with substantial gains in all currencies (while outperforming every other major asset class), gold is resuming its historical monetary [...]

]]> By: Stock Lurker http://livingoffdividends.com/2009/11/16/gold-is-a-lousy-investment/comment-page-1/#comment-75668 Stock Lurker Wed, 02 Dec 2009 20:02:59 +0000 http://livingoffdividends.com/?p=1352#comment-75668 As WWII Germany has proven... Its not about wealth or storage of value. Its about utility. Who cares if your money is worth nothing as long as you got a labor force willing to work for you (free or forced). Every single income transaction feeds power back into the USD through the use of income tax (the natural anti-inflation). Even if your income is paid in gold or you trade in gold with other persons, that transaction is taxed (or is supposed to be) and if you do not pay it, then you go to jail. This forces people to believe the USD is valuable. After all they are forced to pay taxes in it and if they don't have it... Then they go to jail. Even your overseas income is taxed even if no longer live USA. You basically have to renounce your US citizenship. The difference between the USA and Zimbabwe is its force of power over its citizens. You can just print more money and make people value the currency... You have to make them fear it and that is my point. Millions of people go into work everyday and expect to be paid in dollars. As long as people still work and are productive it doesn't really matter. Even wealth in gold is subjective and as an opinion. Investment-wise, treasuries have always been a horrid investment and I have never a single dollar in one. I won't invest in precious metals simply because of their supposed value. It only takes $80 an ounce to get gold out of the ground so until gold gets $1000 worth of usage in industry, electronics, or science then I'm not investing in it. All it does it go into vaults and sits there.... Not really useful IMO. As WWII Germany has proven… Its not about wealth or storage of value. Its about utility. Who cares if your money is worth nothing as long as you got a labor force willing to work for you (free or forced).

Every single income transaction feeds power back into the USD through the use of income tax (the natural anti-inflation). Even if your income is paid in gold or you trade in gold with other persons, that transaction is taxed (or is supposed to be) and if you do not pay it, then you go to jail.

This forces people to believe the USD is valuable. After all they are forced to pay taxes in it and if they don’t have it… Then they go to jail.

Even your overseas income is taxed even if no longer live USA. You basically have to renounce your US citizenship.

The difference between the USA and Zimbabwe is its force of power over its citizens. You can just print more money and make people value the currency… You have to make them fear it and that is my point.

Millions of people go into work everyday and expect to be paid in dollars. As long as people still work and are productive it doesn’t really matter. Even wealth in gold is subjective and as an opinion.

Investment-wise, treasuries have always been a horrid investment and I have never a single dollar in one. I won’t invest in precious metals simply because of their supposed value. It only takes $80 an ounce to get gold out of the ground so until gold gets $1000 worth of usage in industry, electronics, or science then I’m not investing in it.

All it does it go into vaults and sits there…. Not really useful IMO.

]]> By: Living Off Dividends http://livingoffdividends.com/2009/11/16/gold-is-a-lousy-investment/comment-page-1/#comment-75448 Living Off Dividends Tue, 01 Dec 2009 22:25:17 +0000 http://livingoffdividends.com/?p=1352#comment-75448 at some point all of the revenue the IRS takes in will go towards servicing debt. We currently have nearly $100 Trillion worth of unfunded debt obligations - the only way we can get out of this is printing massive amounts of money - which has to lead to very high levels of inflation. If you think its irrelevant, then continue to hold dollars and invest in treasuries. 30 years of bretton woods might turn out better than 5,000 years of using gold as currency. good luck! at some point all of the revenue the IRS takes in will go towards servicing debt. We currently have nearly $100 Trillion worth of unfunded debt obligations – the only way we can get out of this is printing massive amounts of money – which has to lead to very high levels of inflation. If you think its irrelevant, then continue to hold dollars and invest in treasuries. 30 years of bretton woods might turn out better than 5,000 years of using gold as currency. good luck!

]]> By: Stock Lurker http://livingoffdividends.com/2009/11/16/gold-is-a-lousy-investment/comment-page-1/#comment-75446 Stock Lurker Tue, 01 Dec 2009 22:06:15 +0000 http://livingoffdividends.com/?p=1352#comment-75446 The issue about the US unable to pay back its debt is irrelevant as it can simply produce more US dollars to pay back the debt as the US treasury contract requires. The 3rd party cannot ask the US Government for anything else specified according to the agreement in the details of the US Treasury. That said, 3rd parties can stop buying debt which would cause problems. However, if you haven't looked at the numbers... China is not the highest owner of US debt. Strangely enough it is the Federal Reserve itself. Also if the numbers are to believed, the US government and fed has more gold stored away than anyone and if gold goes up... They still have control over it. The truth of the matter though is not that the US dollar is backed by gold, but rather its bureaucracy and military might. The USD is backed by IRS, the world's largest ratio of inmate to citizen population, and nuclear weapons. The issue about the US unable to pay back its debt is irrelevant as it can simply produce more US dollars to pay back the debt as the US treasury contract requires.

The 3rd party cannot ask the US Government for anything else specified according to the agreement in the details of the US Treasury.

That said, 3rd parties can stop buying debt which would cause problems. However, if you haven’t looked at the numbers… China is not the highest owner of US debt. Strangely enough it is the Federal Reserve itself. Also if the numbers are to believed, the US government and fed has more gold stored away than anyone and if gold goes up… They still have control over it.

The truth of the matter though is not that the US dollar is backed by gold, but rather its bureaucracy and military might.

The USD is backed by IRS, the world’s largest ratio of inmate to citizen population, and nuclear weapons.

]]> By: Living Off Dividends http://livingoffdividends.com/2009/11/16/gold-is-a-lousy-investment/comment-page-1/#comment-72855 Living Off Dividends Mon, 16 Nov 2009 22:45:00 +0000 http://livingoffdividends.com/?p=1352#comment-72855 personally, i think silver might be a better valuation than gold right now. I own AUY, CDE & GDX. personally, i think silver might be a better valuation than gold right now. I own AUY, CDE & GDX.

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