Here is how we respond to the myths of gold as propagated by some father-in-laws, some financial advisers and all Paul Krugmans.
Myth 3: Gold Has No Value or No Intrinsic Value
Gold has value today and has retained value throughout history. This value derives from it being extremely rare and finite in nature – unlike paper and electronic money and due to constant universal demand. Gold has an intrinsic value in and of itself, in the same way that oil or water have an intrinsic value.
Myth 4: Gold Has No Utility
Gold has a utility and is a very useful metal as it is used in electronics, technology, dentistry, medicine, industry, jewellery including wedding rings, as medals and trophies denoting the pinnacle of achievement. Gold’s most important use is as a foreign exchange reserve, a store of wealth and as financial insurance.
Recent academic findings and the historical record confirms that gold is a safe haven asset and an important diversification as a means of preserving wealth.
Myth 6: Gold Is A Bubble or Was A Bubble
Gold may have been a bubble when it soared to over $1,900/oz in August 2011. Opinions differ.
At the very least gold had become very overvalued in the short term. After falling 35% since then to nearly $1,200 per ounce, it is hard to still maintain that gold is a bubble. Especially as the average global cost to mine one ounce of gold has now risen to $1,200/oz.
Looking for a secure way to buy physical gold and silver?
GoldMoney company offers you 6 months of FREE storage if you sign-up and buy physical metals via GoldReference site. Simply choose “GoldReference.org” from the dropdown list, or manually write goldreference, when you open a Holding at GoldMoney. See also our page How To Buy Gold & Silver Online.