Is Time to Sell Your Gold?
If we were speculators, we might consider selling. But here at The Daily Reckoning, we’re not gamblers. We hold gold because it represents real wealth, not because we think it will go up in price.
We don’t really know what direction it is going. But that’s why we hold it. We don’t know what direction anything is going. The nice thing about gold is that it doesn’t matter. Gold doesn’t go anywhere. It just sits there.
If you buy a bond, for example, you have to worry about the credit quality of the issuer. If things get bad enough, he won’t be able to pay up. Your bond could be worthless.
Same for stocks. A stock is a share of a company. If the company goes out of business, your stock certificates (assuming you have them) are only good for decorations.
Real estate is more reliable. But there are taxes and upkeep to pay.
Gold is a better way to store wealth. You don’t pay property taxes on it. And the roof never leaks.
Besides, gold is especially valuable when other forms of money lose their appeal. The trend of debt destruction will probably not end soon. And the feds will probably sooner or later follow Paul Krugman’s advice to “raise [the Fed’s] long-term inflation target to help convince the private sector that borrowing is a good idea and hoarding cash is a mistake.”
In the meantime, gold may go down in dollar terms. Which will make a good time to buy it.
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