I almost jumped into SKF yesterday after the end of day rally, but I thought I’d better wait and see what was going to happen next. Glad I did.
I am very nervous now about the “market” and the counter-party risks that you highlighted recently.
It all makes me think of gold, but I have held off from that in anticipation of further declines in metals. In addition, the potential for restriction on buying & selling gold has always been a concern, and now it seems even more probable. Such an action could really hit hard if one was heavily positioned in physical gold and could not trade it. THis is the one issue that many gold advocates prefer not to think about. I can’t help but think about it.
Yes, we have to plan for that last contingency. I have simply assumed that it will happen at some point. Gold could be contraband. And although I think it may fall more in the near term, the greater risk is in not owning any.
How does one plan for a gold ban that would oulaw buying and selling gold? The last ban lasted many years. In such a case, it seems that not owning gold would then be a good thing. Unless, of course , you held your gold outside of the United States where it could still be traded.
Is the only safe option to hold gold outside of the United States? If so, how? Perth Mint? A vault in Switzerland?
I should note that there is no reason not to visit Zurich. It is among the world’s most beautiful cities, and your business there is still perfectly legal as long as you report it to the beancounters (and databases) in DC, and this you must do if you have a healthy fear of the Spanish Inquisition.
Bjorn
September 19th, 2008 at 12:19 pm
I almost jumped into SKF yesterday after the end of day rally, but I thought I’d better wait and see what was going to happen next. Glad I did.
I am very nervous now about the “market” and the counter-party risks that you highlighted recently.
It all makes me think of gold, but I have held off from that in anticipation of further declines in metals. In addition, the potential for restriction on buying & selling gold has always been a concern, and now it seems even more probable. Such an action could really hit hard if one was heavily positioned in physical gold and could not trade it. THis is the one issue that many gold advocates prefer not to think about. I can’t help but think about it.
Mike
September 19th, 2008 at 12:49 pm
Yes, we have to plan for that last contingency. I have simply assumed that it will happen at some point. Gold could be contraband. And although I think it may fall more in the near term, the greater risk is in not owning any.
Bjorn
September 19th, 2008 at 1:56 pm
How does one plan for a gold ban that would oulaw buying and selling gold? The last ban lasted many years. In such a case, it seems that not owning gold would then be a good thing. Unless, of course , you held your gold outside of the United States where it could still be traded.
Is the only safe option to hold gold outside of the United States? If so, how? Perth Mint? A vault in Switzerland?
Mike
September 19th, 2008 at 2:21 pm
I trust the Swiss over the Aussies, no comparison. The government and social climate down under greatly resembles that of the US, Canada and the UK.
It still makes sense to have some small amount on hand if you live in the states, but by no means a large hoard.
Mike
September 19th, 2008 at 2:35 pm
I should note that there is no reason not to visit Zurich. It is among the world’s most beautiful cities, and your business there is still perfectly legal as long as you report it to the beancounters (and databases) in DC, and this you must do if you have a healthy fear of the Spanish Inquisition.