Tag Archives: Gold

Gold Price Decline

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Gold is falling and it’s big news. Here are some comments in terms of the Permanent Portfolio, which holds gold. First of all, all the assets have been going up in tandem for a bit of time. It is almost inevitable with this investing approach that one is going to fall off the rear of the pack. And if we consider how we want our diversification to work, this is expected. Investors that hold a portfolio where everything is going up all once can also be in a portfolio where everything can go down at once. You need to have Continue reading →

TIPS, Gold, and Lying Politicians

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Treasury Inflation Protected Securities (TIPS) are a siren song. You are guaranteed a payment above the government issued Consumer Price Index. Sounds great. Yet ignoring the fact that this yield is negative due to the current market, the government is not capable (or willing) to protect you from the inflation they are causing. Economics and politics are connected at the hip. Numbers in a spreadsheet do not tell you about political risk that often comes with high inflation. In general, know this: 1) High inflation is a political problem in almost every case. The people causing the inflation usually know they Continue reading →

Gold – The Insurance Asset

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Gold is a really religious topic for investors. People either love it or hate it. As part of the Permanent Portfolio we hold gold along with other assets. This gets a lot of people up in arms and I hear comments about gold not being an inflation hedge, is not money, is not useful in a portfolio, serves no purpose, etc. Well, I want to set the record straight on this asset from my own perspective. Gold is an insurance asset. It’s not perfect (what is?), but when currencies are having a problem people want gold. It’s interesting because some Continue reading →