Gyroscopic Investing

Ad Orientem wrote: to keep a roof over your head and food on your table for a couple years in case a catastrophic situation does come to pass. 

Coffee wrote:

Ad Orientem wrote: to keep a roof over your head and food on your table for a couple years in case a catastrophic situation does come to pass. 

How many of us could afford to keep $100k in gold coins buried in our backyard?

TripleB wrote: ↑Tue Nov 15, 2011 4:19 pm The idea of having physical gold in the PP is nice, and assuring. I question how important it is. The reason for this post, is to explore the costs/benefits of holding physical gold. It's certainly ideal to hold physical gold, just as it's ideal to get married and have a loving wife. The reality though is that there are risks involved and things don't always turn out as planned.

I reject the notion of using gold coins to barter in the post-apocalyptic world. Most Americans today are "pussies" and will have their valuables taken by force, by the 1% of society that are Sociopaths. Some Americans are strong/fighters who are not sociopaths, but we probably won't protect the pussies because we're too busy protecting ourselves and our families.

If society collapsed, I don't see people bartering gold coins. It seems kind of ridiculous. I see people bartering services and tangible items like food, water containers, fuel, ammo, etc.

I don't see the US Government collapsing, along with the US Dollar, without society going into collapse as well. So the idea that the gold coins will protect me from a government collapse, just sends me into the scenario of above where I don't feel the need to barter coins in the future.

That said, there are a few things physical gold is good for, in my mind:

1) Failure of ETFs that hold gold.
2) Tyrannical Government that seizes/freezes assets of dissenters
3) Getting out of the country, before a society collapse, and using the coins as bribes or to demonstrate wealth to a new country

I'll address these one at a time:

1) Failure of ETFs that hold gold. This has to be weighed against the risk of theft/less of physical gold coins. What are the chances that the ETF will fail, versus you losing your coins?

The existing risk, looking backwards are that *no* Gold ETFs have ever failed. However, people have had their gold coins stolen from their homes, and seized from "abandoned" safe deposit boxes. I'd like to think that I can control the risk better by holding the coins myself, but that may be the same irrational thought process that makes people think it's safer to drive a car than to fly in an airplane. It's the "illusion" of control.

2) Tyrannical Government that seizes/freezes assets of dissenters.

This is a legitimate risk, and one that merits having some portion of gold coins separate from your "traceable" accounts. In this case, I wouldn't store them anywhere that is tied to you, nor would I insure them. This drives the risk of loss up, but is the only way to ensure a future tyrannical government doesn't freeze all your wealth.

3) Getting out of the country, before a society collapse, and using the coins as bribes or to demonstrate wealth to a new country

This is legitimate but I think it's probable you will still have access to your brokerage accounts, even if the country fails. It would also be safer to electronically forward money to your new country, then try to transport gold coins. The theory being that current first world nations typically require $X in wealth for someone to emmigrate in. i.e. If you want to become a citizen of Switzerland you have to have something like $1M in net worth, because they don't want you to be a drain on their society, using their welfare systems. I envision something similar in the future if the US collapsed, where other countries would allow US Citizens in, if we had a certain level of wealth.

Ideally holding physical gold is great. But in reality, it can be stolen from your home, or seized from your safe deposit box. You can insure it for 0.5% to 5% or so, depending on storage conditions, but there's counterparty risk involved because the insurance company may default or refuse to pay. In my mind, having 1% to 5% of your overall portfolio in physical gold coins, should be "good" and if I had to estimate, may be a risk-reward efficient position.

For example, having another marginal unit of physical gold puts greater risk on theft, but the benefit of that marginal unit of gold in the event of country collapse is minimal.

ppnewbie wrote: ↑Tue Feb 25, 2020 12:17 pm Great book recommendation for all of my fellow collapsatarians. “The Mandibles” by Lionel Shriver. It’s a fun read that tells the story of a family living through in the US as it defaults on its debts, loses world reserve currency status and seizes the assets of its citizens.

It’s a fun read

TripleB wrote: ↑Tue Nov 15, 2011 4:19 pm The idea of having physical gold in the PP is nice, and assuring. I question how important it is. The reason for this post, is to explore the costs/benefits of holding physical gold. It's certainly ideal to hold physical gold, just as it's ideal to get married and have a loving wife. The reality though is that there are risks involved and things don't always turn out as planned.

I reject the notion of using gold coins to barter in the post-apocalyptic world. Most Americans today are "pussies" and will have their valuables taken by force, by the 1% of society that are Sociopaths. Some Americans are strong/fighters who are not sociopaths, but we probably won't protect the pussies because we're too busy protecting ourselves and our families.

If society collapsed, I don't see people bartering gold coins. It seems kind of ridiculous. I see people bartering services and tangible items like food, water containers, fuel, ammo, etc.

I don't see the US Government collapsing, along with the US Dollar, without society going into collapse as well. So the idea that the gold coins will protect me from a government collapse, just sends me into the scenario of above where I don't feel the need to barter coins in the future.

That said, there are a few things physical gold is good for, in my mind:

1) Failure of ETFs that hold gold.
2) Tyrannical Government that seizes/freezes assets of dissenters
3) Getting out of the country, before a society collapse, and using the coins as bribes or to demonstrate wealth to a new country

I'll address these one at a time:

1) Failure of ETFs that hold gold. This has to be weighed against the risk of theft/less of physical gold coins. What are the chances that the ETF will fail, versus you losing your coins?

The existing risk, looking backwards are that *no* Gold ETFs have ever failed. However, people have had their gold coins stolen from their homes, and seized from "abandoned" safe deposit boxes. I'd like to think that I can control the risk better by holding the coins myself, but that may be the same irrational thought process that makes people think it's safer to drive a car than to fly in an airplane. It's the "illusion" of control.

2) Tyrannical Government that seizes/freezes assets of dissenters.

This is a legitimate risk, and one that merits having some portion of gold coins separate from your "traceable" accounts. In this case, I wouldn't store them anywhere that is tied to you, nor would I insure them. This drives the risk of loss up, but is the only way to ensure a future tyrannical government doesn't freeze all your wealth.

3) Getting out of the country, before a society collapse, and using the coins as bribes or to demonstrate wealth to a new country

This is legitimate but I think it's probable you will still have access to your brokerage accounts, even if the country fails. It would also be safer to electronically forward money to your new country, then try to transport gold coins. The theory being that current first world nations typically require $X in wealth for someone to emmigrate in. i.e. If you want to become a citizen of Switzerland you have to have something like $1M in net worth, because they don't want you to be a drain on their society, using their welfare systems. I envision something similar in the future if the US collapsed, where other countries would allow US Citizens in, if we had a certain level of wealth.

Ideally holding physical gold is great. But in reality, it can be stolen from your home, or seized from your safe deposit box. You can insure it for 0.5% to 5% or so, depending on storage conditions, but there's counterparty risk involved because the insurance company may default or refuse to pay. In my mind, having 1% to 5% of your overall portfolio in physical gold coins, should be "good" and if I had to estimate, may be a risk-reward efficient position.

For example, having another marginal unit of physical gold puts greater risk on theft, but the benefit of that marginal unit of gold in the event of country collapse is minimal.

Ad Orientem wrote: ↑Wed Nov 16, 2011 7:41 pm There is no method of holding gold that is risk free.  Counterparty risk affects every option except home storage, which has its own risks that IMO outweigh the counterpaty risks of a bank safe deposit box or even an ETF.  I really don't have a problem with having some of your gold in an ETF for convenience purposes as long as you understand and are willing to accept the risks that come with it.  But I will always advocate keeping enough gold in physical form, somewhere you can get you hands on it quickly, to keep a roof over your head and food on your table for a couple years in case a catastrophic situation does come to pass.  Do I expect such a thing?  No.  But I am a student of history and no one expected it in June of 1914 either.

Harry.Browne wrote: ↑Mon Apr 13, 2020 8:00 am Assassination June 28, 1914
https://en.wikipedia.org/wiki/Assassina ... _Ferdinand

TripleB wrote: ↑Tue Nov 15, 2011 4:19 pm The idea of having physical gold in the PP is nice, and assuring. I question how important it is. The reason for this post, is to explore the costs/benefits of holding physical gold. It's certainly ideal to hold physical gold, just as it's ideal to get married and have a loving wife. The reality though is that there are risks involved and things don't always turn out as planned.

I reject the notion of using gold coins to barter in the post-apocalyptic world. Most Americans today are "pussies" and will have their valuables taken by force, by the 1% of society that are Sociopaths. Some Americans are strong/fighters who are not sociopaths, but we probably won't protect the pussies because we're too busy protecting ourselves and our families.

If society collapsed, I don't see people bartering gold coins. It seems kind of ridiculous. I see people bartering services and tangible items like food, water containers, fuel, ammo, etc.

I don't see the US Government collapsing, along with the US Dollar, without society going into collapse as well. So the idea that the gold coins will protect me from a government collapse, just sends me into the scenario of above where I don't feel the need to barter coins in the future.

That said, there are a few things physical gold is good for, in my mind:

1) Failure of ETFs that hold gold.
2) Tyrannical Government that seizes/freezes assets of dissenters
3) Getting out of the country, before a society collapse, and using the coins as bribes or to demonstrate wealth to a new country

I'll address these one at a time:

1) Failure of ETFs that hold gold. This has to be weighed against the risk of theft/less of physical gold coins. What are the chances that the ETF will fail, versus you losing your coins?

The existing risk, looking backwards are that *no* Gold ETFs have ever failed. However, people have had their gold coins stolen from their homes, and seized from "abandoned" safe deposit boxes. I'd like to think that I can control the risk better by holding the coins myself, but that may be the same irrational thought process that makes people think it's safer to drive a car than to fly in an airplane. It's the "illusion" of control.

2) Tyrannical Government that seizes/freezes assets of dissenters.

This is a legitimate risk, and one that merits having some portion of gold coins separate from your "traceable" accounts. In this case, I wouldn't store them anywhere that is tied to you, nor would I insure them. This drives the risk of loss up, but is the only way to ensure a future tyrannical government doesn't freeze all your wealth.

3) Getting out of the country, before a society collapse, and using the coins as bribes or to demonstrate wealth to a new country

This is legitimate but I think it's probable you will still have access to your brokerage accounts, even if the country fails. It would also be safer to electronically forward money to your new country, then try to transport gold coins. The theory being that current first world nations typically require $X in wealth for someone to emmigrate in. i.e. If you want to become a citizen of Switzerland you have to have something like $1M in net worth, because they don't want you to be a drain on their society, using their welfare systems. I envision something similar in the future if the US collapsed, where other countries would allow US Citizens in, if we had a certain level of wealth.

Ideally holding physical gold is great. But in reality, it can be stolen from your home, or seized from your safe deposit box. You can insure it for 0.5% to 5% or so, depending on storage conditions, but there's counterparty risk involved because the insurance company may default or refuse to pay. In my mind, having 1% to 5% of your overall portfolio in physical gold coins, should be "good" and if I had to estimate, may be a risk-reward efficient position.

For example, having another marginal unit of physical gold puts greater risk on theft, but the benefit of that marginal unit of gold in the event of country collapse is minimal.

TripleB wrote: ↑Tue Nov 15, 2011 4:19 pm
The idea of having physical gold in the PP is nice, and assuring. I question how important it is. The reason for this post, is to explore the costs/benefits of holding physical gold. It's certainly ideal to hold physical gold, just as it's ideal to get married and have a loving wife. The reality though is that there are risks involved and things don't always turn out as planned.

I reject the notion of using gold coins to barter in the post-apocalyptic world. Most Americans today are "pussies" and will have their valuables taken by force, by the 1% of society that are Sociopaths. Some Americans are strong/fighters who are not sociopaths, but we probably won't protect the pussies because we're too busy protecting ourselves and our families.

If society collapsed, I don't see people bartering gold coins. It seems kind of ridiculous. I see people bartering services and tangible items like food, water containers, fuel, ammo, etc.

I don't see the US Government collapsing, along with the US Dollar, without society going into collapse as well. So the idea that the gold coins will protect me from a government collapse, just sends me into the scenario of above where I don't feel the need to barter coins in the future.

That said, there are a few things physical gold is good for, in my mind:

1) Failure of ETFs that hold gold.
2) Tyrannical Government that seizes/freezes assets of dissenters
3) Getting out of the country, before a society collapse, and using the coins as bribes or to demonstrate wealth to a new country

I'll address these one at a time:

1) Failure of ETFs that hold gold. This has to be weighed against the risk of theft/less of physical gold coins. What are the chances that the ETF will fail, versus you losing your coins?

The existing risk, looking backwards are that *no* Gold ETFs have ever failed. However, people have had their gold coins stolen from their homes, and seized from "abandoned" safe deposit boxes. I'd like to think that I can control the risk better by holding the coins myself, but that may be the same irrational thought process that makes people think it's safer to drive a car than to fly in an airplane. It's the "illusion" of control.

2) Tyrannical Government that seizes/freezes assets of dissenters.

This is a legitimate risk, and one that merits having some portion of gold coins separate from your "traceable" accounts. In this case, I wouldn't store them anywhere that is tied to you, nor would I insure them. This drives the risk of loss up, but is the only way to ensure a future tyrannical government doesn't freeze all your wealth.

3) Getting out of the country, before a society collapse, and using the coins as bribes or to demonstrate wealth to a new country

This is legitimate but I think it's probable you will still have access to your brokerage accounts, even if the country fails. It would also be safer to electronically forward money to your new country, then try to transport gold coins. The theory being that current first world nations typically require $X in wealth for someone to emmigrate in. i.e. If you want to become a citizen of Switzerland you have to have something like $1M in net worth, because they don't want you to be a drain on their society, using their welfare systems. I envision something similar in the future if the US collapsed, where other countries would allow US Citizens in, if we had a certain level of wealth.

Ideally holding physical gold is great. But in reality, it can be stolen from your home, or seized from your safe deposit box. You can insure it for 0.5% to 5% or so, depending on storage conditions, but there's counterparty risk involved because the insurance company may default or refuse to pay. In my mind, having 1% to 5% of your overall portfolio in physical gold coins, should be "good" and if I had to estimate, may be a risk-reward efficient position.

For example, having another marginal unit of physical gold puts greater risk on theft, but the benefit of that marginal unit of gold in the event of country collapse is minimal.

TripleB wrote: ↑Tue Nov 15, 2011 4:19 pm 1) Failure of ETFs that hold gold. This has to be weighed against the risk of theft/less of physical gold coins. What are the chances that the ETF will fail, versus you losing your coins?

bitcoininthevp wrote: ↑Fri Sep 03, 2021 9:30 am

TripleB wrote: ↑Tue Nov 15, 2011 4:19 pm 1) Failure of ETFs that hold gold. This has to be weighed against the risk of theft/less of physical gold coins. What are the chances that the ETF will fail, versus you losing your coins?

Maybe you were mentally including these risks under the "Failure of ETFs that hold gold" umbrella, but to outline some example risks of the ETF:

- "Paper" gold price might not track physical price
- Confiscation methods are trivial for ETFs, harder for physical
- Wealth or other taxes (similar to confiscation)
- Freezing of assets
- Potential restrictions on amounts you can sell or otherwise transact

The likelihood of all of these seems way up over the last couple years and to my eye trending upward into the future. And yes, I realize some of these might require resisting or disobeying laws on the physical side of things.