Month: March 2022

Are Precious Metals A Good Investment?

There are many reasons and incentives for saving money in gold, silver, platinum, and other precious metals. The most obvious one is simply that the value of these assets has historically tended to rise when stock markets crash—while in times of economic prosperity, they may then fall back down again.

However, “liquidity” is not a term you can apply to assets like these. There are two reasons for this: gold and silver coins are heavy, and their storage costs will be high compared with savings in local currencies.

And the second reason is probably more important: To get your hands on some precious metals fast — fast enough to provide you with a financial buffer against a possible recession or a steep fall in real estate prices — you will be trading in some of the significant advantages of this type of investment, to begin with. Hard cash, banknotes, or a checking account are typically much more liquid than bullion: you can get cash in tiny amounts in a matter of minutes at virtually any bank.

Benefits of Investing in Precious Investments.

One of the main reasons for buying precious metals is protecting you against a major financial catastrophe, such as a depression or currency crisis. And there are plenty of companies that can help you with your investment, but JM Bullion is one of our favorites. To get more information see this JM Bullion review and make a decision from there…

If hyperinflation hits your country, for example, you’ll be in a much better position if you invest some of your money in gold or silver coins. You can store them in a safe place at home and wait it out: when the crisis is over, they will have retained their value much better than other assets such as property and stocks.

Another important reason for investing in gold and silver is its historical appeal: Gold has been used as money for thousands of years because it’s durable and relatively cheap to produce and because its ownership gives people a sense of security. As the Bank of England said in a recent paper, “the possession of gold enhances wealth transmission to future generations.”

The third reason is that it has historically proven to be one of the safest investments out there. Although there have been some fraudulent schemes over the years (such as selling fractional gold coins), they have had limited effects on the price of gold and silver—which are still only a tiny fraction of what they used to be. The fact that precious metals are not part of the banking system, which may collapse at any moment, also offers a degree of safety that you can’t get from other assets.

Other advantages of investing in precious metals include:

· In case of economic crises, it’s much easier to get hold of money in gold and silver than in U.S. dollars, euros, or other major currencies, which can be in short supply at any given time. If your bank fails, you can get hold of your money from a cash dealer–as opposed to exchanging it with the central bank at a fraction of its original value, as is usually the case with national currencies.
· Gold and silver can be stored for a long time without losing value. This makes them ideal for people who have to save for retirement but don’t want to invest in stocks that could lose 30% of their value in one day. It also makes them an ideal investment for traders, who can store their money in gold until they’ve made enough to retire.
· The cost of storing gold and silver is meager. A 10-ounce bar of gold costs about $1,000–a minimal amount compared with the fees charged by mutual funds or other types of investment accounts. It’s also very convenient: you don’t have to travel anywhere, and there are virtually no limits on the amount you can store yourself at home.
· If a major financial crisis hits, you will have time to get the money out of your precious metals. The central banks of most countries would have a hard time confiscating people’s gold and silver: it’s impossible to track every ounce or gram, and the logistics would be overwhelming.
· The social status attached to gold and silver is not going away anytime soon. It has an intrinsic value beyond its use as an investment or as a store of considerable wealth.

Cons to investing in precious metals include:

· The price of gold and silver is highly volatile. If you buy gold or silver when it’s trading at high prices, you could lose money in the long run if these prices are not sustained. For example, the price of gold fell by more than 50% between 2006 and 2009, almost wiping out half of all profits that were made in this period, according to a recent study by Bank of America.
· Gold and silver are hard to transport: they’re heavy to carry and are much bulkier than any national currency. For example, a 5-kg box of gold (the same as the State Department measures) is much more difficult to carry when you’re carrying all your belongings than a 5-kilo box of cash. That’s why most people choose to buy only ounces or tenths of an ounce at the moment–which makes it easier to monitor your investments.
· Gold and silver are typically not accepted in shops, restaurants, and hotels: if you want to buy anything with them, you’ll have to sell them on the open market first. This could be a major problem if everything that you own collapses simultaneously, leaving you penniless.
· Records of ownership are not only hard to follow, but also easy to lose. If someone steals your gold coins or steel bars, it’s almost impossible to prove that they’re yours–or who has taken possession of them.

If you’re interested in investing in gold or silver coins, it’s essential that you do so with a certain amount of caution–after all, this is an extremely volatile investment. As with all investments, there may be a few months when you don’t make money at all, but there are also plenty of opportunities to earn substantial profits. As gold and silver have traditionally been used as a store of value, it’s likely that the price would rebound over time if the financial crisis is prolonged.