Jeff Clark, Senior Precious Metals Analyst
DEC 29, 2016
I intercepted a message that came from gold herself. Yes, she spoke, and was talking to an investor that was discouraged about her recent price action. It was such a powerful message that I thought I’d pass it along to you for the new year. It’s a good reminder of why we all own gold right now and that we’ll all someday soon be vindicated. – Jeff Clark
I understand you’ve had some worries about me, and some frustrations about my price. I thought I’d speak to you directly, to put your mind at ease. I want to let you know why you’ll be much better off with me than almost any other asset over the next few years.
I know my price may not be rising as quickly as you want, but I’ve been around a long time and have survived many leaders, regulations, and monetary systems. I’m still here and they’re not.
I’ve provided monetary protection many times throughout history, from kings and counts to serfs and servants. I can do the same for you, no matter your background or station in life. As long as you own a sufficient amount of me and my cousin silver, your finances have a shield in place that can’t be pierced.
Whatever financial events come your way, I will be there to protect your assets and preserve your standard of living. That’s particularly important at this time in history—I look at your bond and stock and real estate markets and I see a lot of paper, a lot of risk, and a lot of bubbles. Based on my experience over the past several millennia, I’ll be around long after those investments whither. I’ve never gone to zero.
I know many investors are concerned about my price. Don’t worry, it will get there in time, and at the point you need it most. There have been plenty of times in history, as my friend Mike Maloney has pointed out, where my price has soared and made investors wealthy. Looking at your debt and currency issues today, it’s not hard to predict that you and your fellow citizens are headed for another one of these repricing events. I can tell you that you’ll be glad you own me when it happens.
My Many Attributes Give You Power
I’m about much more than just price. I carry considerable power as money and as an investment. If you own me, look at all the advantages you have with me…
• I am a tangible asset. You can hold me in your hand, which you can’t do with most any other investment. I can’t be destroyed by fire, water, or even time. And unlike other commodities, I don't need feeding, fertilizer, or maintenance.
• I have no counterparty risk. If you hold the real me, there is no paper contract to make me whole, no middleman needed to make me good. I am the only financial asset that is not simultaneously some other entity’s liability. I don't require the backing of any bank or government.
• I am highly liquid. I can be sold virtually anywhere in the world. There are gold dealers in just about every major city on the planet, so you can sell me easily and at little cost. Even in a crisis, I will be easy to sell, and in fact will be in high demand. Other collectibles, like artwork, could take much longer to sell, have a smaller customer base, and will likely require you pay a big commission.
• I am a store of value. My price fluctuates, but my value is timeless. Consider how much more valuable I will be in 5 years compared to the currency of your country. And since I will outlast you, I am an ideal asset to pass on to your heirs.
By the way, don't fret about those who criticize me because I don’t produce any income. They misunderstand my role. I'm not trying to produce income; my function is as money and a store of value. That’s also why I shouldn’t be viewed as a commodity; I don’t get used up, and am primarily used as money more than anything else.
• I can’t be hacked or erased. I don’t think it is wise to have all your wealth in digital form today. I am a tangible asset that stands at the ready in case your online world comes crashing down, or even if you’d just like some diversification away from the web.
• I am value dense. You can hold $50,000 of me in the palm of your hand. I take up such little space that you can store more value in a safe deposit box with me than stacks of your currency notes.
• I am private and confidential. How many assets can you say that about in today’s world? You must pay taxes on any gain, of course, but if you want a little privacy or confidentiality, I’m about the only asset that can offer you this.
• I require no specialized knowledge. If you don’t know how to spot a real diamond, aren’t familiar with the painter Van Gogh, or don’t collect comic books, just buy some of me. No special skills or training needed.
• I am portable. You can take me literally anywhere in the world. Travelers like me, especially if you buy me in my ”have gold/will travel” form.
• I come with low maintenance and carrying costs. You might pay a small fee to store me, but compare that to the costs and taxes and headaches of, say, real estate. You can even buy and sell me without a stock broker.
That’s not all. I provide you with a level of protection that almost no other asset can offer…
• Capital controls. If your currency crashes, your leaders may prohibit financial assets from leaving the country. You can store some of me in another political jurisdiction and sidestep this punitive restriction.
• Deflation. Most people will see at least 10 recessions in their lifetime. Because of your debt and other monetary concerns, the next one could be punishing. Remember, I have a low correlation to other investments and so am more likely to rise when they fall in the next crisis.
• Inflation. I am widely known as one of the best hedges against inflation. In fact, my price even outperforms in hyperinflation.
• Bank account freezes and bank bail-ins. Your government leaders have some crazy notions about how to solve the financial problems they themselves created. So it’s probably a very good idea that you keep some of your wealth outside the banking system. That’s easy to do with me.
• Crisis. My cousin silver and I have survived virtually every kind of crisis mankind has encountered. If you think some kind of upheaval is coming, I can assure you that we’ve seen it before, and are your best protection against it.
• Long-term manipulations. Yes, bankers and politicians continue to manipulate my price—but manipulations never last. The manipulators may succeed in the short term, but you will win in the end, because manipulations have a finite life. Eventually my rising price will destroy them, whether it be from soaring inflation or debt blowups or any other kind of crisis. Manipulations eventually fail, so don’t let their shenanigans worry you. And remember, the manipulations allow you to pay a lower price than you normally could, so I suggest capitalizing on my artificially low price.
How many investments can you say this about? Perhaps it’s no wonder than one ounce of me sells for over $1,100.
With me, you have resilience. And from what I see today with your world’s finances and currency, you also have explosive potential.
Even if you never have a crisis, I will still offer value, still carry the above advantages, and can still be passed to your heirs.
The bottom line is that if you own me—the real me, in physical coins and bars—you have more protection and more profit potential than any other asset can offer.
Based on what I’ve witnessed over the past 3,000 years, my advice is to buy me now, while I’m still inexpensive and readily available. Then just store me away, and relax and enjoy your life. Whenever the need arises, I’ll be there for you.
And I can assure you that sooner or later, my price will make you very happy.
P.S. After reading gold’s correspondence, Jeff bought some more ounces. He purchased some of this and some of this. If you, too, were moved by what gold had to say, we encourage you to take advantage of the recent selloff and prepare your portfolio for 2017.