If Andy, et. al. purchased gold and are still holding they are only showing a paper gain. It's no different than buying and holding stocks. You don't make or lose money until you have sold. Thats how you keep score.

What I find amusing is that many keep refering to how much money their gold is worth, $350, $375, etc. I thought they were all moving away from fiat money? If so why do they value their holdings in terms of fiat money? Maybe you guys should start formulating new valuations. Like Turkish rugs!! My oz. of gold is worth 2.3 Turkish rugs. Oh, I forgot that guy in Turkey didn't want gold. Oh well you'll have to keep working on the "right" valuation model. Hey, I know...rather than fiat money maybe you could tie your holdings to Fiat cars (just a thought). But make certain to discontinue all references to the U.S. dollar because, if you remember, in the future dollars won't be wort

-- goldbugged (goldbugged@idontthinkso.com), October 05, 1999

Answers

...dollars won't be worth anything.

g

-- goldbugged (goldbugged@idontthinkso.com), October 05, 1999.

"If so why do they value their holdings in terms of fiat money?"

Because the grocery store takes fiat money and my mortage is in fiat money.

-- ng (cantprovideemail@none.com), October 05, 1999.

troll alert

-- cody (cody@y2ksurvive.com), October 05, 1999.

My student loan is denominated in dollars. Duh.

-- b (b@b.com), October 05, 1999.

So, grocery stores, mortgage companies, and student loans all still take fiat money. What if they quit taking it tomorrow. "We want goods instead", they all collectively decide. You offer them gold in lieu of money they no longer accept. How much will you be giving them? Just curious

-- goldbugged (goldbugged@idontthinkso.com), October 05, 1999.

Actually, a serious question. What will we do with our profits? Too often, people ride a stock (or metal) all the way up -- then all the way back down. To actually make a profit, you have to take a profit. At the sell point, then what to put the proceeds into?

As someone said on another thread (sorry don't remember who/which), what's a good strategy for a Y2K 5 is not good for a 10, and vice versa.

If the financial markets are still functional, then proceeds can go into other commodities that have not risen as fast, or declined, relative to the dollar. If they aren't functional, may as well hang onto the metal itself (at least the portion you don't convert to food, water treatment, and machined lead parts.) sorry gotta go, maybe will continue later

-- A (A@AisA.com), October 05, 1999.

I'm sorry that A had to cut his post short, because he was definitely on a roll, and giving good answers to actually what is a good question.

There may be a few precious metal zealots out there that will have nothing to do with fiat money, but the realists accept the fact that we live in a fiat money world. In my own case, my gold coins predominately consist of 1/10th ounce American Eagles, but I do have some one ounce AEs, the express purpose of which is to sell for fiat money if it looks like it might be advantageous to do so.

There is nothing contradictory here. The goal is to get through what is coming, and using whatever it takes -- including fiat money -- to do it.

-- Jack (jsprat@eld.~net), October 05, 1999.

Gold:

If we offer them legal tender and they refuse, then I believe that the debt is discharged (lawyers, please weigh in on this one). If you give them back $10,000 + interest for a debt you owe them, then you have paid them back. At least that's my understanding. Besides, how can the individual consumer control the loss in buying power that could be caused by inflation?

-- b (b@b.com), October 05, 1999.

"If we offer them legal tender and they refuse, then I believe that the debt is discharged (lawyers, please weigh in on this one). If you give them back $10,000 + interest for a debt you owe them, then you have paid them back."

Hey, I'd like to hear feedback on this!

-- Mumsie (Shezdremn@aol.com), October 05, 1999.

A,

I spent a long time researching and figuring this out, starting in 1997, when I concluded that management which was refusing to fund fixing things was going to destroy a lot of enterprises.

The present situation is we have a asset bubble in equities, IMHO. These equitiess represent a lot of enterprises that are going to be in deep trouble in short order.

Charles Kindleberger wrote Manias Panics and Crashes, basically an economic history of these events for hundreds of years. They are (almost) always the same. People invest in an asset class in an economy, at the same time that there is an increase in the money supply in the economy, and make a lot of money. Their friends, neighbors and relatives look at them making money and jump on the bandwagon, creating a mania. The asset goes out of sight. Then an external event happens which causes people to reevaluate what they are doing, and a panic and crash occurs. Kindleberger claims that if there is a fixed date, it always increases the panic. These things go on all the time, cycling from one asset class to another.

So, IMHO you want to get out of the bubble and into what will be valued next. I thought that had to be something which was currently low in price. I also believed you had to be diversified, because the manipulators (government, investment houses, central banks) have a lot of power and can force the price of any assset down. So I looked at the asset classes these mania had cycled through, whether they are high or low in price and exposure to Y2K bugs. Here's what I decided:

Stock equities High Exposed

Bonds High Exposed

Physical Gold Low Safe

Gold Stocks Low Somewhat exposed

Commodities Low Somewhat exposed

Short options Low Somewhat exposed

Transportation High Exposeed

New Technology High Exposed

Real Estate High Exposed

So (this is retirement accounts, by the way) what I did was this:

40% Money market

15% Commodity fund (Oppenheimer real asset is the only one I know of)

15% Gold mining stock

10% Shortselling fund (BEARX)

15% Company stock (Can't sell till 55 or retirement)

5% Physical Gold

I believe any of these defensive options could go up 10 or 20 times. If it happens to one and not the others, I'll simply rebalance. I am reasonably comfortable that the companies' managing these assets systems will operate (did my due diligence). I am 8 years from retirement, so I will have to reevaluate this plan in 3 years.

P.S. They gave me some nice stock options, that I think will be worthless, but if I am completely wrong and those DOW 36,000 guys are right, that will be OK too.

-- ng (cantprovideemail@none.com), October 06, 1999.