In this episode of Finance U, Chris and David Russell from GoldCore discuss the impact of rising global uncertainty on gold prices. David highlights that uncertainty, driven by geopolitical tensions and domestic polarization, is a significant factor influencing gold’s value. He points out that central banks have been early drivers in the recent gold rally, acting out of prudence rather than fear or greed. However, high-net-worth investors are increasingly entering the market, and fear-based investing could become more prominent as geopolitical conflicts escalate, such as tensions in the Middle East and Ukraine.
Additionally, they emphasize the importance of jurisdictional flexibility when investing in gold, noting GoldCore’s global vaults as a safeguard against geopolitical risks. Finally, Chris and David touch on the understated nature of Goldman Sachs’ gold price forecast, suggesting that more is happening beneath the surface than publicly acknowledged, with major buyers in the East influencing market dynamics.
Dave Russell was quite the gentleman at the Summit, when we were sitting together at dinner as I was incoherently rambling. Social awkwardness made worse by a certain level of exhaustion:) My advisor keeps telling me to add more gold to my IRA, gotta do that. You are allowed a certain amount each year and should maybe take advantage of that.
I am adding my 2-cents worth and experience. Since 2005, has gone from $225/oz to 2500/oz. However, one has to pay 28% tax on the capital gain. Second, to convert gold into currency one faces the difference between buying and selling - buy at a 5% or so premium and sell at a 5% discount over the quoted price. Third, gold is darned heavy to carry on your person. If you go through security they call customs to take a look and if the flight is international you may have to bring already completed declarations even though there is no tax on gold bullion. Fourth, the retail price you receive is dependent upon the quantity. A gold ring gives perhaps 10-15% on the gold value. A gold 1kg bar is very close to the quoted price of gold. Fifth, depending upon the country, gold may need to be essayed - tested for purity. Always “buyer beware”. You can end up buying a bar or coin that is not what is claimed.
Gold as a legacy to beneficiaries. If gold is inherited there is no tax as long it is below the prevailing tax threshold. To me it seems to be a really handy way of passing on wealth. If the price goes down the beneficiary can claim a capital loss which can be carried forward. Until you have capital gains to pay taxes on, you do not realize how useful a carried forward loss can be. Think through the concept of inheriting gold in a foreign country and valuing it at the time of death and how capital losses can be accrued. My advice would be to invest in gold 1kg bars as they are about smallest transportable bullion that provides for a low buy/sell spread.
I have never got a coherent answer from someone who claims that there are more buyers than sellers, what do they precisely mean. The only way that can be true is if the buyer isn’t willing to pay a high enough price, or gold has gone no ask. For every buyer there is must be a seller otherwise there is no transaction. Maybe a greater number of individual buyers but that means very little.
Next, gold doesn’t really track money supply. It sort-of-maybe oscillates around it. I would like to calculate an r value but I am not sure how to go about doing that. For a chart see Gold vs M2
On a black pill note, the government can fix the entitlement problem by creating more mrna shots and encourage the elderly to take them. Maybe an mrna for flu or pneumonia? They have found a way to wind down a ponsi scheme, kill the investors before they ask for their money.
Once a professor brought a box of donuts and auctioned it off to the class to prove an economic point. If you’d been there, you’d understand more buyers than sellers. Yes, in the end there was only one buyer/seller, but many people were in the market trying to get those donuts and they went for like $40 in the end.
Back in 2020, I insensitively made the connection and posted “at least Social Security will have less pressure”. I was amazed by how many people caught on and agreed instead of social media hating. I got mean comments for worrying that a bald eagle kept perching on a phone pole over my chickens, but not for that comment.
I have PM (a laughably palltry amount) for pretty much one reason. It’s money and I’ve used it as money to convert it into two tangible assets, 10-seven ton loads of slag gravel spread into driveways to abate the crippling mud after heavy rain, and a used 2022 1025r tractor with front loader and excavator. I bought coins, paid a 1 percent premium in 2009, and used the coins for over twice their cost last March. No 28% tax or fee, just a transaction between two people. The paltry-er amount of PM I have left were unfortunately lost in a tragic boating accident along with all my weapons somewhere in Lake Kerr north of me. Very sad.
I’m sure they’ll turn up eventually, probably during some archaeological dig in the future, when unnamed future inhabitants are busy try to figure out wtf happened in the roaring '20s.