I Dislike Gold, BUT Couldn’t Get Any Cash

(by Vic Patane):

Let’s all assume this is a fictitious story.

You are are a bright, successful fellow, in fact your brokerage account has treated you like a king, it’s now well into seven figures and growing. For some reason however you managed to click one of those SRSrocco videos featuring Tom Cloud on the very same day CNBC is telling you that many many very large web sites are down this morning. Sites like the Wall Street Journal, Twitter and Spotify.

You phone your financial guy and ask that uncomfortable question, “Hey, what if it’s the financial sites that get taken down next?”  Won’t happen you are told, “uhhh, but what if it does?”. Your stomach drops and you instruct your broker to wire $100,000 to your money center bank. You need cash before the  weekend arrives, just to be safe. You rush to speak to your banker and get some cash, it’s nearly lunch time. But here’s the rub, your private banker, after several private calls seems to hesitate before entering the conference room where you are impatiently waiting, no doubt with some bad news. “I’m very sorry sir but we can only get you $2,000 of cash before the weekend, will that do?”

Then that video replays in your mind. You phone Tom and ask what the procedure is to purchase some gold that you wish to hold in your own possession. Gold is not your thing, you don’t use terms like “fiat”, “QE to infinity”, “central banksters” or “sound monetary policy”. You do however understand the value of taking physical possession of an asset in a very quite and discreet way. Your wire is confirmed before closing time Friday and you are called with a tracking number the following Monday. The $100,000 never had to go to your money center bank.

The gold coins arrive in less than a week and are discretely hidden in a pair of old hiking boots, try doing that with $100,000 of cash, if you can get it. Add a zero and maybe you decide to store a portion of your gold off site (at a cost of 20 basis points per year) and as for $1,000,000 of cash at home well as Steve Carell says in The Big Short, “Good Luck with That!”

the-big-short

(photo courtesy of The Big Short)

Gold and Silver may very well end up finding homes with those fearful of days like this past Friday for many reasons other than the truths the precious metal’s community discusses.

Lastly, if you haven’t checked out our new PRECIOUS METALS INVESTING section or our new LOWEST COST PRECIOUS METALS STORAGE page, I highly recommend you do.

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30 Comments on "I Dislike Gold, BUT Couldn’t Get Any Cash"

  1. Nothing but a good ol’ gold article to prop up pageviews.

    Just joking… ?

  2. The measures of a stack of 1,000 fresh $100 notes would be exactly 2.61″ wide by 6.14″ long by 4.3″ high. And the stack would weigh 2 pounds. Doesn’t seem like a problem to keep it at home anywhere to me. And according to your own story, you got your gold in a week. I am sure your private banker would get you those nice crisp $100 bills in a week also.

    The same way, you can hold 10,000 $100 notes off site just the same as you can hold $1 million worth of gold. The dollar notes would weigh 20.4 pounds whereas the gold stack would weigh 53.7 pounds.

    Just saying… These are not reasons to own or hold gold. But as a promotion, it’s acceptable, I guess.

    • If your house burns down, the paper is gone. The gold won’t lose much value, but you will need to be quick on the site.

      • I always insure my property. Is there no insurance in your world?

        Again, these are ridiculous reasons to own gold. There are good reasons to own gold, but none of them were mentioned in this article or in your comment.

        • Home Owner Insurance policies only insure cash for small amounts; not thousands of dollars. The gold couldn’t be insured either, but the point it that the gold wouldn’t turn into just ashes.

      • pdxr13,

        Have you never heard of a fire resistant safe or chest? Paper will be OK if placed inside one of them.

    • Tony,

      I agree.

  3. heh. so your financial site goes black, and you can’t get anything. you smile and take your new 1oz gold coins to the supermarket and try to buy a flat of soup. the nervous cashier calls her boss. he looks at your gold coin and says, “I’m sorry sir, but we can take only money.” you patiently explain to him that gold is money, but he doesn’t care – it’s not money TO HIM, it won’t pay his store’s obligations. so you sigh, and whip out the last of your hundred dollar bills and say, “I’ll take all the soup I can get with this,” congratulating yourself on your superior wisdom and thinking “I’ll just dump this worthless fiat now for a real asset”, and the manager tells you, “I’m sorry sir, but with the net down we’re having trouble with our suppliers, each customer is limited to two cans of soup ….”

    • Soup for a gold coin !!?? Are you kidding !? How about this – you take your gold coin plus 3 others and drive out to the country where everything’s safe. Start talking with the local folk about some land with a dwelling. Being that the economy has been turned on it’s ear there just so happens to be a couple of farmers who wouldn’t mind sub dividing a couple acres for a little shiny stuff. You got to put things in perspective. Leave the soup for the silver dimes !

      • “the country where everything’s safe.”

        heh. ferfal has something to say about that ….

        “You got to put things in perspective.”

        that’s what I’m doing. if things have gotten to the point that you’re trying to buy land for gold, what makes you think those country boys are going to sell you any amount of land for any amount of gold? or even want you around at all? talk about normalcy bias. nah, you’ll drive up to a roadblock sign that says “keep moving” and it’ll have laying in front of it some dead bodies shot down by 30-06, ammo cans full of gold coins laying by ….

        • You draw a bleak picture gman. One that I would think would not apply to every situation out there. It’s impossible to use your example for every circumstance. Yes I am aware of highly suspicious land owners. I have seen the hand scribbled signs nailed to trees warning of trespassing and asses getting blown off. However there will still be ways to go about business dealings using g&s and if you don’t think so , that’s your loss. It’s all about how you handle yourself and if you can correctly read people. It does take a certain skill set. Maybe something you don’t have.

          • “It’s all about how you handle yourself and if you can correctly read people.”

            ok, well, good luck. mind that paradigm change though, it’s a long way down.

  4. That’s what people don’t understand.I wrote it 2 years ago.
    To own Gold means:

    -a good hedge against inflation(which we don’t have in the moment)
    -an insurance when the centralbanks don’t buy out anymore creditors

    As long as the interest rate is so low both upper points are not valid.
    Take the Euro Zone.Draghi buys out what ever he want.(what ever it takes).

    This money printing did not appear in the real economy.It’s only in the financial circle.

    • “This money printing did not appear in the real economy.It’s only in the financial circle.”

      wealth transfer.

      heh. “financial circle”. heh. this “global elite”, this “deep state”. ask yourself – who are these people?

      • In hindsight and IMHO; the money printing started back in the 80’s. The money printed was distributed and used outside North America. Sooner or later it will end up back were it all started. That is when TSWHTF !!!!!

    • We don’t have inflation right now? Really? I disagree. rent, insurance, tuition, etc.

  5. Because fiat currencies always blow up in people’s faces. Especially when growth is over.

    20% in physical gold, 10% silver.
    Every 2/3 months, bar by bar, coin by coin.

  6. Hold both gold and cash.

  7. I am a bit surprised to see so much anonymity towards gold on a precious metal site (in the commentary). Kind of remembers me of 2000 and 2001.

  8. DisappearingCulture | October 26, 2016 at 6:02 pm | Reply

    I don’t see the point of this article, or maybe it doesn’t make its point clearly. To me a bit disjointed.

  9. After purchasing loads of gold and silver 1999-2002, I bought a brand new $81,000 truck for $14000.
    Don’t tell me no one accepts gold or silver for payment. I did.

    • Yeah, I accepted 4ozs of gold for my boat in 2006 worth 2400 clownbux. Things have become exponentially worse since then. They can keep their paper.

  10. Inflation is measured in a “warenkorb(card)”,The german word.When the official inflation is to high, they chance the composition.Other tricks are substitution.When things get expensive people buy other one.
    Next is the quality.When i remeber back what quality of food you got years ago then you know what i mean.

  11. Now it’s thermodynamics! Peak oil didn’t do it. Then you tried an economic crash, a currency collapse, EROI because production cost findings scenario wasn’t the answer. Listening to Cloud, Morgan, Schifff and Butler these past 10 to 20 years is a big mistake. Their forecasts have all failed. The only reason they hype silver is because they are commissioned agents. With all of this, silver still languishes. When 85% of silver production is used in industry, jewelry and silverware, why isn’t there any smart billionaires out there interested in shewing the supply/demand curve by buying a few hundred thousand ounces sending silver up? Your scare tactics are 20 to 50 years down the road.. The USA is full of brilliant innovations that will indeed replace oil as a main source of energy. It is a shame Steve that the world economics or currency must collapse for silver to rise past $20. I’m stacking for my grand children when the true reason for silver shortage exists, demand exceeding supply.

    • Joe Lindell,

      I gather you didn’t even listen to the interview. Anyhow, the Thermodynamic oil collapse is much worse than peak oil.

      Futhermore, Joe, you are what I would label as a CLASSIC COMPLAINER. So, listening to precious metals analysts and buying metals for the past 10-20 years was a MISTAKE, according to you?

      The DOW JONES is up 60% since 2000, while gold is up 500+%.

      Now, you are more than welcome to continue to coming in here and BELLY-ACHE to your heart’s desire. However, don’t you have better things to do with you time, like spend it with your family, rather than being a BROKEN RECORD.

      steve

      • Well said…

      • You call me a broken record? What happened the last 10 years to these gurus forecasting
        silver as a store of value. Buying the stock market was a better thing. Now is the beginning
        of the time to buy silver. Most likely the best time will be 2025 or later. All these gurus did was
        B.S. investors who listened to them and their silver purchases are down 25 to 50% especially
        if you bought silver in 2011 thru 2014 after hearing them “guess” each year wrongly. I read
        your articles for factual info of which you have strayed by quoting these gurus logic to your followers. You should acknowledge your shame. Keep it simple Steve. They know nothing. They are sellers of silver for a commission.

    • “Listening to Cloud, Morgan, Schifff and Butler these past 10 to 20 years is a big mistake. Their forecasts have all failed.”

      they certainly have. not their fault really, they normalcy-bias presumed that existing markets would continue provide scope for value rather than be replaced by a rigged comex that top-down sets value. an easy mistake to make.

      same mistake being made here regarding future markets ….

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