Comment: When it comes to gold

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When it comes to gold

I totally agree - gold is not an investment but a preserver of wealth. Gold maintains its purchasing power, so if you buy 100,000 US dollars worth of gold today, you will be able to purchase in 10 years with that gold whatever 100,000 USD will buy you in today's market - not less and probably not more, either, excluding, of course, a hyperinflation dollar collapse.

Silver, though, I think can be considered an investment because (1) it is highly undervalued in terms of supply and demand and will, logically, eventually have its day of reckoning and catch up to where it ought to be and (2) plays an important role as an industrial metal and, therefore, can move (in the absence of market manipulators) with industrial demand.

Consider if you had 100,000 USD in the 80s. At that time, 100,000 USD could have purchased, in cash, paid in full with no loans (1) a median size home (2) an entire house of furniture (3) a brand new car and (4) a trip to Europe.

In 2012, you could buy about 1/4th of that with 100,000 USD. So saving the 100,000 USD in dollars in a bank account would have been the same as throwing 75% of the cash out the window.

If you had converted the 100,000 USD into gold in the 80s, the gold would today be worth about 430,000 USD, which would purchase, in full, the things you could have purchased in full with 100,000 USD in the 80s. So it retained its purchasing power. You could buy the exact same thing today with it that it could have bought back then.

Now let us consider silver. If you had converted the 100,000 USD into silver back then, today it would be worth around 600,000-700,000 USD. Therefore, you would have increased your purchasing power by over 50%, rendering it an investment.