Buying Gold As An Investment – What You Have To Know?

In this blog post, you will learn how to buy gold as an investment and not to cry, not to complain, and not to blame someone or something afterward.

People tend to blame other people.

People tend to blame the government.

People tend to blame the President regardless of whether his name is Barack or Donald. It’s just the nature of human beings.

No wonder, people tend to blame gold, especially now. Even though, it is just an inanimate piece of yellow metal that has been hammered. What do I mean, and how do people blame gold? And why?

Look at this:

gold historical chart

For ages, gold has been known not only for its beauty but as a symbol of wealth. In 2001 gold started its another journey as an attractive and lucrative investment instrument.

In 2002 most people were thinking about whether to buy gold or not. The same in 2003, 2004. By “people” I mean, ” the vast majority of people” – just ordinary people, the crowd.

In 2005 some of them started to buy gold. But most of the crowd made a decision to get involved in considering gold as an investment only in 2011 when everyone was talking about its investment attractiveness. The price, as a result, was too high. The crowd was excited either to have purchased a few gold coins or to have invested in something like physical gold stored outside of the banking system.

An amazing tool called Google Trends proves what I’m trying to convey:

gold investment google trends

These peaks, as you understand, determine “interest over time”.

I remember, in 2011 I was watching a TV show about the modern age gold rush. Gold coins, gold bars, gold stocks, scrap gold – all the gold was in high demand not only in the United States. People in poor countries like Vietnam were buying gold trinkets, old watches, and on and on.

It means that when the price was about $1600 per ounce a lot of people either purchased gold coins and bars directly or invested in gold some other way (switched to Gold IRA, etc.)

Needless to say, a few years later the same people started to complain. Why? Because of this:

gold historical chart

What about now? Let’s go to Google and see what financial gurus think about gold today:

gold bad investment

As we see, there are four reasons why gold is a bad investment, 5 reasons not to invest in gold, and even an explanation why gold is the worst investment in history!

Today everyone invests in the stock market, mutual funds are doing pretty good as well. Innovative investment tools have not been invented yet (not to mention Bitcoin!).

Can you guess, what the crowd will think when the next crisis happens? Some gurus truly believe that the next financial crisis will be worse than the last (learn why!).

The real explanation of what is happening today, why gold sucks, as they imply,  is easy:

[stextbox id=”info”]The consumers do the opposite of best investment practices: they buy when gold goes up, and sell when gold goes down. [/stextbox]

It’s no surprise. Because if you purchased a gold bar for $3.000, and then sold it for $2.000, probably, you are one of these complainers?

So, how to buy gold as an investment and then not regret, not to blame, not to complain?

Chances are, your financial advisor doesn’t consider gold a long-term investment, because, gold is a currency. Right, it should be a currency but can you buy a loaf of bread for a gold coin?

I (and as I’m always saying, I am not a financial advisor, but I believe, I have the right to have my own opinion and to share it), so, I consider gold a hedge against such things like the stock market crash, banking system collapse, which is sometimes the case.

So, the answer is easy: consider gold a hedge – not against inflation, but against worst possible outcomes.

Even though, during the hard times, even gold is not a panacea (just think back on the Executive order 6102 (the US Government gold confiscation in 1933)

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