Home Uncategorized • Remember that the value of any given currency is always changing

Remember that the value of any given currency is always changing

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unless artificially set by the government which issued the currency (and that in and of itself gets really complicated really fast). A lot of economists have argued for a lot of years over what any given currency is truly worth. The fact that they all compare modern currencies against gold is one of the issues I keep coming back to in terms of my own comfort level. If the world’s best economists are continually comparing different currencies against gold, then it’s the gold that has the solid value and the different currencies which are changing over time. Since the original post was whether to invest in gold as a potential protection against a falling dollar, that would seem the ideal instrument for that purpose, since gold’s value is inversely related to the dollar’s value. In other words, the worse the dollar performs, the better gold performs when measured in dollars. All the arguments about whether it gains value compared to other stocks is irrelevant under the scenario that the dollar has become catastrophically devalued. And that was the scenario given in the original thread.As for the risk of it being stolen, I had to chuckle at that (in a dark humor sort of way). If you’ve been on the list awhile, you’ll perhaps recall that I wrote about how my dad came very close to losing all his paper assets last summer. In the space of 45 minutes, he got calls from bankers at 2 different banks, and brokers at 3 different investment firms, trying to get confirmation that he had actually ordered the transfer of all his accounts to some other bank. The ONLY reason he got those calls was because the receiving bank was in a foreign country, and as such had to submit to extra notification requirements. Had the transfer taken place on American soil, he never would have gotten those calls and all his paper asset accounts would have been emptied. So no, physical gold is no more at risk of theft than paper assets. Identity theft is as real a risk to paper assets as a thief in the night breaking into the house. For that matter, in some ways gold/silver can be stored a lot more securely than most other forms of currency. You can lock it up anywhere you deem secure. With paper assets, you only have that firm’s or bank’s security to assure you of its safety. For my dad, who thought he had his accounts very nicely secured, it very nearly wasn’t sufficient. Ironically, given the amount of identity theft going on currently, banks and investment firms are having to take more and more precautions to ensure that you are who you say you are when you want to withdraw money.

Author:AMA