Is buying gold bars a good investment?

Hello Everyone !

I was planning to do some investment stuff and the thought of investing in gold came to my mind. I have no expereince in investing in gold like purchasing the gold bars etc. So your thoughts are appreciated !!

Is it worth investing ? What is the best place to buy gold bars, I have looked into perthmint.com.au but no special prices are available. How about overseas buying ?

Regards

Comments

  •  

    Investment advice is best from someone who knows your circumstances..
    Buying something like Gold seems to me to be something for the Pros.
    My advice is pay down your debt (if you have any).. best investment you can ever make!

    •  

      Thanks for that.. as if now I am debt free ( result of some investements which I did initially) ..have invested in stocks but never tried in gold so thought of trying something new..

  • +1 vote

    a 1kg gold bar is in the order of $55,000… and you face security/insurance and storage issues

    i am of the opinion in the short term that gold has reached its peak… events in the EU will most likely make it rise

    i am not sure what kind of issues you face bring gold into the country en masse

  •  

    would be a great investment if the world blows up!!! (financially speaking)

    you dont have to invest in the physcial gold to get in on the action.

    you can buy stock which mirror the gold price (Ticker:GLD)

    •  

      i would not advise that since gold bonds/fte's or whatever are just paper in an emergency and remember… company pays itself before it pays YOU

      but again, speak to a financial advisor

      IMO gold has gotta just a tad too expensive… $1,750 an ounce? yeah…

  •  

    Physical Gold is a good investemnt. Gold is a hedge against financial collapse and paper gold is just a piece of paper. If you are in Sydney try ABC Bullion http://www.abcbullion.com.au/ they have very less margin over the spot price. Australia is a good place to buy gold, don't get into overseas purchase as there is always a risk with it and bullion in Australia doesn't have any tax like GST attached to it.

  • +2 votes

    Gold is not an investment per se it's a hedge against inflation. A recession is imminent and governments will be printing money in order to continue paying for goods and services (like useless wars). Markets are on the brink of collapse anyway; Greek default unavoidable.

    With that said you have to remember that purchasing gold in Australia carries the risk of being reclaimed by the government. There's legislation giving the government power to do so in times of financial distress.

  •  

    An alternative is to buy Gold Mining stocks, if the price of gold rises, so will the stock. Then again if it falls it does likewise. But you dont have to worry that someone might break in and steal the gold.

    Except of course if the whole economy crashes and no one wants paper anything. But even then its going to be hard to cut a little piece off a gold bar to pay for a loaf of bread

    •  

      that would describe almost any country on the African continent that's on the brink of financial collapse!
      if you look at the 20 year gold price history, you will see 2011/12 is the highest by far, if you had bought in 1999/01 and sold now you would have made a nice ~6.5X gross profit, so to buy now you would be bold indeed!

      • +1 vote

        not quite. it is prudent to diversify your investments and gold is still on an uptrend. it hasn't reached the peak. the demand for gold will continually increase as investors use it as insurance against future inflation (there's no other tool left for capitalist societies to maintain the fiat currency system).

        One can look at the hyperinflation that's ravaged many african nations, Zimbabwe for example, and you can see why gold is so appealing. we're nearing a point where the huge collapse in world markets will cause a global depression that'll leave the 'great depression' of early 1900's look like joke. fiat (paper money / digits in a computer) currency doesn't mean much when it's not backed by anything tangible. what we have is a system of complete fraud where banks can create liquidity from nothing; irresponsible government that does not hold the peoples interests at heart through massive borrowings that take lifetimes to repay. Capitalism needs to restart for this mess to be fixed.

        •  

          Governments! printing money

          Hmmm the basis for any non capitalist economy is central… Government!

          I guess any argument can be used to support ones own biases…

          Elephants dance Ants get squashed.

          Hence in reality it's totally the Ants responsibility to avoid an Elephant Dance

          Good luck Mr Ant!!!

  • +2 votes

    Terrible investment. Warren Buffett tells why in his recent sharholder newsletter…

    "Today the world’s gold stock is about 170,000 metric tons. If all of this gold were melded together, it would form a cube of about 68 feet per side. (Picture it fitting comfortably within a baseball infield.) At $1,750 per ounce – gold’s price as I write this – its value would be $9.6 trillion. Call this cube pile A.

    Let’s now create a pile B costing an equal amount. For that, we could buy all U.S. cropland (400 million acres with output of about $200 billion annually), plus 16 Exxon Mobils (the world’s most profitable company, one earning more than $40 billion annually). After these purchases, we would have about $1 trillion left over for walking-around money (no sense feeling strapped after this buying binge). Can you imagine an investor with $9.6 trillion selecting pile A over pile B?

    Beyond the staggering valuation given the existing stock of gold, current prices make today’s annual production of gold command about $160 billion. Buyers – whether jewelry and industrial users, frightened individuals, or speculators – must continually absorb this additional supply to merely maintain an equilibrium at present prices.

    A century from now the 400 million acres of farmland will have produced staggering amounts of corn, wheat, cotton, and other crops – and will continue to produce that valuable bounty, whatever the currency may be. Exxon Mobil will probably have delivered trillions of dollars in dividends to its owners and will also hold assets worth many more trillions (and, remember, you get 16 Exxons). The 170,000 tons of gold will be unchanged in size and still incapable of producing anything. You can fondle the cube, but it will not respond."

    •  

      isn't missing the whole point of gold. isn't it to sort of hedge your bets on if there is financial collapse you have something tangible and valuable? it probably makes sense to invest in other things to increase your profits, but i thought gold acts as a safe haven (hence why it's going up so much, people are freaking out)?

      •  

        Absolutely. Gold is there as insurance if the whole system collapses. And if you buy for that reason, the only time its in your advantage to sell, is when you need the food/services when the system does collapse. A terrible thought.

        While none of us want that to happen, in hindsight, a little gold insurance might prove to be a great investment for that situation.

    •  

      LOL He has been saying it for over a decade now. Any idiots who listen to him and buy his shares since the GFC would have lost a lot of money.

      See this and this

      http://www.dailyreckoning.com.au/why-buffett-and-gartman-are...
      http://www.zerohedge.com/news/guest-post-warren-buffett-pric...

      He may be considered an oracle in the stock market, but he isn't completely flawless and is subject to the same biases that everybody else do.

      As zerohedge's article say, his insights are only applicable to the prior era and it is coming to an end.

      •  

        If you believe that people will stop shaving (Gillette), banking (Wells Fargo & American Express), chewing gum (Wrigleys), eating chocolate (Seers Candy) and drinking Coke.

        If that era is over then WB's future wealth is in a lot of trouble.

        Gold is only worthwhile if we go into a period of hyperinflation (eg Germany after WW2).

        WB will be wrong on gold until he is proven correct.

    •  

      Mr Buffett is talking his own book though. Keep in mind that he's a stocks man and gold would be the polar opposite of investing in stocks (unless you're buying gold stocks which is a whole different kettle of fish). The last thing Buffett is going to admit to is that American stocks are overpriced and that the whole US economy is sitting on a precarious house of cards.

      •  

        The opposite. Read the first chapter of his biography The Snowball. WB tells a room ful of silicon valley tycoons that their companies are grossly overvalued. Buffett doesn't care what the sharemarket does. He buys high quality businesses that he never sells and collects the profits. He doesn't care if share prices are high. His famous quote is "the sharemarket does not exist…..it is only a reference to see if anyone is doing anything foolish".

        •  

          Well in this case he would be the fool because so far he has consistently been wrong about the rise of gold. It goes to show he doesn't really understand the subject matter that he is criticising.

        •  

          Absolutely WB has been wrong and for a very long time. He consoles himself with the rivers of cash that pours into his bank account each year from Pile B. Pile A investors are sitting much higher but the foundations are much weaker…they are relying on future investors to keep paying for gold at these prices or higher. Future income streams are what gives an asset value…speculating on higher prices for an asset with no income stream is as high risk a strategy as you can get.

        •  

          Yeah it's very nice when you have the whole casino rigged so you always win. I stand by my original comment. Buffett only talks his own books. It's especially nice to be able to front run stocks that you know will get bailed out by your buddies at the Fed cough Goldman Sachs cough. When it comes to precious metals just do the opposite of what Buffett says and you will make a killing. That much is almost certain.

  •  

    that's a terrible argument from buffett (allegedly)

    in reality people buy a house, land, shares and maybe some precious metals

  •  

    If you buy gold you should buy from reputated seller ( so you can sell it back to ppl/firms) such as www.perthmint.com.au ( to help local business out ).

    Or American, Canadian, European gold coins ects…

    The price of gold almost went up 1.5times in the last 1 and 1/2 years. I suggest go with silver first to get some experience, then later on go gold.

  • +1 vote

    Enjoying my 2100% annually in tobacco and cacao, you can keep your gold.

  •  

    By the time everyone says buy something, you are too late. History shows that you should do the exact opposite of what everyone says at the time.

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