These are the top 10 reasons (Part 1) why I personally believe it is important to buy gold bullion coins. I will begin with the 10 through 6 today and give you the rest tomorrow.
Reason 10: Developing Countries Love Gold
Let’s fast forward 50 years. Is the United States going to be the same global superpower that it is today? Probably not. Developing countries such as India and China are thriving. They bring an immense amount of intelligence to the table, low priced labor, and surging populations. They will be replacing US jobs over the long term more and more. There are two tangents here. The first is directly related to gold. Citizens of India and China love gold. It’s part of their culture. India is the top gold consumer of the world. If their country is doing so well, gold will certainly rise as more India citizens have funds to acquire more gold. The second tangent is not related to gold but I wanted to qualify this all that I’m not trying to scare you. Knowledge is power and this is a long term trend. Armed with this knowledge, why not use the trend to make money through gold and also by acquiring stocks and businesses that profit from the rise of India and China. You want to have these very intelligent and hard working countries working for you as an investor!
Reason 9: All Fiat Currencies Come To An End
Fiat money refers to money that is not backed by precious metals. The US Dollar is a great example of fiat currency because it is only backed by faith in the government. Throughout history, all countries that have based their monetary system on fiat currency have come to an end. Gold is the ultimate way to combat an inflationary environment and fiat currency. While inflation on fiat currency spirals out of control, gold retains its value. I think it’s fairly certain that the US Dollar will continue to devalue and that inflation is here to stay. This makes gold bullion coin ownership a must.
Reason 8: Gold Bullion Coins Are Small And Portable
This is the crazy one! You can store all of your wealth in your pocket with gold coins. They are very small and very valuable. If you want a discreet way to hide your assets and protect them, gold coins are a super idea. Do I recommend keeping you life savings in your pocket? Absolutely not. It makes the most sense to store you gold coins in several different safe deposit boxes and vaults. However, should you need your coins in an emergency, you can withdraw them and carry this wealth on your person. This is a powerful concept in the event of an emergency. Want to keep a few gold coins close to home? This may make sense depending on our situation (for just a few coins) and you may want to check out my tips on hiding gold coins.
Reason 7: Gold Coins Are A Hedge Against Inflation
Inflation is out of control. Oil prices are hitting new highs and there is no sign of relief in sight. Interest rates are at all time lows to protect banks who made terribly risky loans. The interest rate cuts of the 90s have created a monumental inflation problem and it will be difficult if not possible to climb out of the hole. What is someone to do who wants to protect their hard earned savings? It’s easy, buy gold coins. Gold coins are the ultimate hedge against inflation. This is evidenced through the recent rally in the price of gold. Let me qualify, however, that even in the absence of inflation I still believe gold is a tremendous investment because of reason number 3 above. Gold coins are extremely rare. There are not enough to go around. Due to supply and demand, this reason alone is enough to propel gold prices (inflation adjusted) to amazing heights in my opinion.
Reason 6: Gold Coins Are A Timeless Store of Value
Companies go in and out of favor. There are few large companies that have transcended time and generations. This means a stock investor has to trade and shift funds between companies that are going in and out of favor. This is not the case with gold. Gold bullion coins have been in favor forever. Gold coins are just as respected today as they were several centuries ago. Buy gold and you’re buying a timeless investment that can be passed on forever to future generations.
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