This is my first 'blog', ever. There are not many things at my age which you do for the first time. Well maybe more than I would admit to.
Seriously, welcome to the Atkinsons the Jewellers blog. I want this to be something we all get involved in. Please, please respond to my blog with stories, witticisms, observations and your thoughts on our world in the gold and silver investments. You know the rules. Surely I don’t need to tell you not to be abusive to anyone. We can all disagree with others opinions, but let’s all try and help each other with informative, constructive discussion on matters coins and bullion.
Time means that I will not be able to reply directly to everyone, but I will endeavour to read everything.
So those are the rules and on to the thoughts.
Often clients will ask, what do you think? Where is the price going? Is it a good time to buy?
(Sorry more rules) We as a business cannot give advice. It’s your money you must spend it as you will. Prices will go down as well as up. However as we all know, gold has in fact risen for each of the last 11 years. What does that tell you? It tells me we are in a different world than we were only a decade ago. So what has changed? My humble opinion is that over the last three decades there have been several huge changes in world economies which have resulted in the last 11 years of growth in the price of gold and silver.
Everyone knows the reality of the world debt and the future responsibilities of pensions and welfare but I’ll give you a couple of other reasons to back them up in our argument for gold.
CHINA- It’s a game changer for everyone. The day that the Chinese decided to open their economy to the world was the start of an economic revolution for us all. It doesn’t matter which business you are in, the Chinese have had their effect. In relation to Gold and soon Silver my belief is that the Chinese are underpinning the currency with the yellow stuff. Not admitting it of course, but would you really want to own anymore USD/Euros if you were them.
Some Chinese whispers get distorted as they pass from one person to another. The one which told the Chinese Government Investment fund, and for that matter the population of China to buy gold was heard LOUD AND CLEAR from Hong Kong to Beijing. Just look at the World Gold Council facts on how much China has bought in each quarter of the last few years. The chart is upwards. Stability is what the Government of China desire. With all those people getting wealthier every day, they must have stability in the economy. Just how large will that economy be in 2020? What will the GDP be then? How wealthy will the people be? Have you seen the predictions on car sales if things keep growing the way they are now?
The Government of China must keep the economy as stable as they can. As far as my simple observations can predict, that means currency which could in real terms be in some sort of loose gold standard, and all the benefits it brings.
So they stole our idea! Wow, get in the queue behind Louis Vuitton, Gucci et al. I’ve been in business with the Chinese. I have the utmost respect for them. What they don’t know they learn! When they’ve garnered the knowledge they use it. To coin an advertising phrase – “simples”.
Technology- It’s 2012. I could have used my iPad or my iPhone to write this blog. How incredible is that. I remember watching Captain Kirk and thinking, would we ever have a phone we could carry around which flipped down so you could speak to your friends or family. Maybe even see them on it. I’ve got news for you, it’s been and gone with the Motorola flip. The reason I mention this is that when it comes to electronic trading , that second by second 24/7 trading which goes on while we eat sleep and go to the gym – hey, it’s the New Year, the diets on again - Gold has become just another thing you can buy and sell electronically without ever touching it.
You don’t need to have it, or hold it, or feel it, or touch it, you can get a piece of paper or a note on your screen which tells you what you have. Brilliant, just brilliant! Although it wouldn’t suit me. I prefer the feel of the real stuff. The security it gives and the knowledge I’ll still have it whatever happens to the price. It’s not a piece of paper, or a promisary note. I don’t care how much there is in some vault in the snowy Swiss mountains I want to have what I’ve bought in my hand. It’s mine and I’ll sell it or trade it when I want, no one will influence that except me. Play the ETF’s or the GLD’s or whatever the initials mean, but for me, you pay us and we’ll deliver. That’s how we like it and that is the how and why we set up our site the way we have.
The difference the electronic dealing will make is that it will never go away. Every transaction means someone is making their cut. Gold is now another stock or share or product to be traded by the dealers and traders. Sure it will go up and down in the short term, but I firmly believe we are in a different world with gold. The future is more large funds whether hedge funds or pension funds, will realise the falling supply and increasing demand of gold and get on board. It will become a standard part of your pension fund or savings, and although I can hear the opposition saying it pays no interest, just look at the past 11 years and work out the rate of interest on that! Never mind the fact that we are in a world of negative (-3.5%) interest rates.
Until next time,