Anecdotal evidence that gold is far from being in a bubble
A friend of mine just started work at at financial fund in the City of London. During his induction day one part of the session was dedicated to IFAs (independent financial advisors) to explain their role within the financial industry. All pretty standard stuff. Right up until the speaker of the session pulled up a slide titled “anecdotes” on his powerpoint presentation.
Under the heading “the best IFA anecdote” we got the following rather extraordinary tale:
“The best IFA anecdote i have was the slightly warped view of a nameless IFA from the north of England. He wasn’t interested in [us] because he believed that the government was part of a global conspiracy to devalue all the paper currencies to the point we would all be forced to join a global currency.”
“As such he was selling all of his clients assets and investing purely into gold! Not sure that’s appropriate financial advise for his clients but who am i to judge”
I have it on good authority that the room chuckled as the story was being read out.
Now, first up it’s interesting that the views of the IFA we’re called “slightly warped”. Especially when you consider, as we reported back in March, that George Osborne, the UK Chancellor of the Exchequer himself, was chairing a panel session at the G20 titled “Global liquidity management issues (including global financial safety nets and the role of the SDR)”.
We have extensively covered the role of the SDR here, here, here and here. It’s hardly a “global conspiracy”, a replacement for the dollar is now openly talked about, not just in the mainstream media but actually by our political class. The only unknown is their real intent, but regardless of their intent there is certainly a not so quiet move on to make the SDR the new reserve currency of choice.
It’s also funny to see that “appropriateness” of advising clients to buy gold is even questioned. It’s a shame that nobody in the room during the presentation put their hand up and asked how long ago did the IFA start advising his clients to buy gold? Here is a quick breakdown of how that advice has panned out over the past 4 years depending on when it what given:
- 4 years ago gold trades £320 – up 190%
- 3 years ago gold trades £425 – up 118%
- 2 years ago gold trades £600 – up 55%
- 1 year ago gold trades £770 – up 20%
- 6 months ago gold trade £850 – up 9% (18% annualized)
- 3 months ago gold trades £830 – up 11% (44% annualised)
So even if this IFA chucked it all in only 3 months ago and got his clients into gold, they’re up 44% annualized at todays price of £925 – not only was the advice very appropriate it was also hugely profitable.
The fact that idea of buying gold, or a replacement for the dollar might be in the offing, is still, after all we’ve been through since the collapse on 2008, being laughed at and not by the average guy on the street, but people who work in one of the biggest money centers on the planet is good reason to believe that gold is far, far, from being in a bubble.
Link to this article: : http://www.goldmadesimplenews.com/gold/anecdotal-evidence-that-gold-is-far-from-being-in-a-bubble-3718/