Do You Have Buying Gold in Your Portfolio? Don’t Let Special Interests Misguide You

The FEDs want us to believe that paper money is just as good as gold, but it isn’t. That’s why it keeps taking more and more paper money to buy an ounce of gold. I think everyone who considers our current economic policy unsound needs to own some gold to hedge against runaway inflation.

How much gold should you own? Most investment authorities suggest you hold 10% of your assets in gold. That may sound extreme to some people and not nearly enough to others. I think the exact amount boils down to your investment goals.

10% is a good general rule for most people in normal times. If you consider now to be “normal times”, then 10% is the right amount to buy. If you think these aren’t “normal times”, then you might consider increasing the amount you buy.

Buy as much gold as you can afford on a regular basis, consistent with your financial goals. Set up a monthly allotment for buying gold and stick to it. Don’t try to predict the lows of the market and buy then. Chances are you won’t have saved enough cash when the market bottoms, to go make the major purchases you intended.


I planned to really buy a lot of gold when it got down below $1,500 an ounce. It never got below $1,500 an ounce and I hadn’t saved the money for it, if it did. So, I continue to buy a small amount every month.

I also recommend buying gold coins rather than gold bars or other bullion. Coins are easier to liquidate if needed, than bullion. It is impossible to predict whether or not the Government would confiscate gold bullion in the near future.

Our dollar is no longer on the gold standard, so things are completely different than they were in 1933, when Roosevelt confiscated the gold bullion held by private citizens. I think it’s not likely gold will be confiscated again, but not impossible.

It wasn’t until 1975 that US citizens were allowed to buy and hold gold again. Since then, gold has been treated as a commodity. As a commodity, gold has kept up with inflation, holding its value far better than silver.

Coins, especially rare gold coins are more volatile than bullion. In good times, they will get premium prices, in bad times they will get bullion prices when no one can afford their premium prices.

If you buy for numismatic purposes only, follow the advice of buying the best you can afford. If you sell, wait until the good times. The prices will rise much more in good times and drop much more in the bad times. So, bad times are the good times to BUY the upper level gold coin for your collection.

When you buy gold coins for investment as well as collecting, I recommend buying common, high grade verities rather than the truly rare ones. They will hold their value in bad times and get a substantial premium over spot gold in good times.

If you are buying coins for investment only, buy what interests you. Gold eagles, gold maple leafs and gold pandas are often good choices. If you are more interested in value, find what coins sell for the least premium over spot. Usually these are European gold coins.

Since I like variety, I buy every example I can find. I collect new, old, foreign, domestic, bullion and rare-ish type coins. I tend to be a “type” collector, when it comes to gold and collect coins of a certain type, rather than by date and mint. The gold coin field seems to be a good area for this style of collecting.

You should try to buy gold coins at the lowest price you can, from someone you trust. You should buy it on a regular basis. But remember, owning gold is far more important than waiting to get it at a certain price. That is, paying slightly too much when buying gold is better than not owning any at all.

You can know the approximate price of the  gold you’re buying, by consulting your favorite website that gives up-to-date pricing. If you’re buying gold regularly, I like the “Coin Dealer Newsletter” (or the grey sheet) for expert pricing information.

Furthermore, you should be buying gold when you see so many signs in store windows that say “we buy gold.” Stop buying gold when the signs change to “we sell gold.” At that time, you can get out of the market and wait for another time to buy, or sell some of the pieces you don’t want and get more gold coins when the signs change back to “we buy gold” again.

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