Investing in Gold can be one of the worst investments out there, and I’ll explain why this isn’t quite the “Golden Opportunity” people think it is…and why this investment won’t always “Pan Out.” Enjoy. Add me on Snapchat/Instagram: GPStephan
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How does Gold look from an INVESTMENT standpoint? And is this even an investment to begin with? Since gold was a fairly fixed price prior to 1970, we can really only look back at the last 45 years of data to determine the average price of gold, and adjust that for inflation. If we take the price in 1978 of $208 an ounce, we can reasonable determine that would be $838 in today’s money. As we know, gold right NOW is $1200 an ounce. This means that effectively your gold went up in value 45% adjusted for inflation…over 40 YEARS. Just as a comparison, the SP500 index went up in value 630% during that same period, adjusted for inflation.
So given that…in 40 YEARS, gold only went up - on average - of about 1% annually, adjusted for inflation. Versus the SP500, which went up in value 5x MORE during that same period.
First, Gold is also just really, REALLY inefficient to invest in. Owning PHYSICAL gold has many drawbacks…first, there’s a wide spread between bid and ask prices to ensure that the moment you purchase gold, you are IMMEDIATELY underwater on your so-called “investment.” Then you have shipping costs for an expensive metal that you’ll have to include, as well. Then once you get your gold investment, you’ll have to figure out how you’ll store it. Other companies charge you for storing your gold.
Another important distinction when it comes to gold is that gold doesn’t throw off cash, much like a stock’s ability to produce income for the share holder. It doesn’t give you interest…it just kinda sits there, looking pretty.
So why do people even consider this an investment? Or why is this even called a hedge against an inflation? Well…the reality, is that it’s neither. It’s a hedge against FEAR. The more people FEAR about inflation, economic issues, or defaults…the higher the price of gold climbs. The thought process is that while paper currency can’t be trusted, GOLD will also retain value. But U.S. Treasuries Securities have never been defaulted upon in anyone's lifetime.
So here’s the moral of the story…golds prices are correlated with our fear in the economy, whether or not it’s warranted. After its peak in 2011, when was pretty much the BEST and lowest times to buy just about anything in the markets, gold was at its highest…and has been on a slow decline since then. And remember Warren Buffets “Golden” Rule? Be GREEDY when others are FEARFUL…and FEARFUL people are the ones buying GOLD.
For business inquiries or paid one-on-one real estate investing/real estate agent consulting or coaching, you can reach me at GrahamStephanBusiness @gmail.com
Suggested reading:
The Millionaire Real Estate Agent: http://goo.gl/TPTSVC
Your money or your life: https://goo.gl/fmlaJR
The Millionaire Real Estate Investor: https://goo.gl/sV9xtl
How to Win Friends and Influence People: https://goo.gl/1f3Meq
Think and grow rich: https://goo.gl/SSKlyu
Awaken the giant within: https://goo.gl/niIAEI
The Book on Rental Property Investing: https://goo.gl/qtJqFq
Favorite Credit Cards:
Chase Sapphire Reserve - https://goo.gl/sT68EC
American Express Platinum - https://goo.gl/C9n4e3
Join the private Real Estate Facebook Group:
https://www.facebook.com/groups/therealestatemillionairemastermind/
Get $50 OFF FOR A LIMITED TIME: Code THANKYOU50 - The Real Estate Agent Academy: Learn how to start and grow your career as a Real Estate Agent to a Six-Figure Income, how to best build your network of clients, expand into luxury markets, and the exact steps I’ve used to grow my business from $0 to over $120 million in sales: https://goo.gl/UFpi4c
How does Gold look from an INVESTMENT standpoint? And is this even an investment to begin with? Since gold was a fairly fixed price prior to 1970, we can really only look back at the last 45 years of data to determine the average price of gold, and adjust that for inflation. If we take the price in 1978 of $208 an ounce, we can reasonable determine that would be $838 in today’s money. As we know, gold right NOW is $1200 an ounce. This means that effectively your gold went up in value 45% adjusted for inflation…over 40 YEARS. Just as a comparison, the SP500 index went up in value 630% during that same period, adjusted for inflation.
So given that…in 40 YEARS, gold only went up - on average - of about 1% annually, adjusted for inflation. Versus the SP500, which went up in value 5x MORE during that same period.
First, Gold is also just really, REALLY inefficient to invest in. Owning PHYSICAL gold has many drawbacks…first, there’s a wide spread between bid and ask prices to ensure that the moment you purchase gold, you are IMMEDIATELY underwater on your so-called “investment.” Then you have shipping costs for an expensive metal that you’ll have to include, as well. Then once you get your gold investment, you’ll have to figure out how you’ll store it. Other companies charge you for storing your gold.
Another important distinction when it comes to gold is that gold doesn’t throw off cash, much like a stock’s ability to produce income for the share holder. It doesn’t give you interest…it just kinda sits there, looking pretty.
So why do people even consider this an investment? Or why is this even called a hedge against an inflation? Well…the reality, is that it’s neither. It’s a hedge against FEAR. The more people FEAR about inflation, economic issues, or defaults…the higher the price of gold climbs. The thought process is that while paper currency can’t be trusted, GOLD will also retain value. But U.S. Treasuries Securities have never been defaulted upon in anyone's lifetime.
So here’s the moral of the story…golds prices are correlated with our fear in the economy, whether or not it’s warranted. After its peak in 2011, when was pretty much the BEST and lowest times to buy just about anything in the markets, gold was at its highest…and has been on a slow decline since then. And remember Warren Buffets “Golden” Rule? Be GREEDY when others are FEARFUL…and FEARFUL people are the ones buying GOLD.
For business inquiries or paid one-on-one real estate investing/real estate agent consulting or coaching, you can reach me at GrahamStephanBusiness @gmail.com
Suggested reading:
The Millionaire Real Estate Agent: http://goo.gl/TPTSVC
Your money or your life: https://goo.gl/fmlaJR
The Millionaire Real Estate Investor: https://goo.gl/sV9xtl
How to Win Friends and Influence People: https://goo.gl/1f3Meq
Think and grow rich: https://goo.gl/SSKlyu
Awaken the giant within: https://goo.gl/niIAEI
The Book on Rental Property Investing: https://goo.gl/qtJqFq
Favorite Credit Cards:
Chase Sapphire Reserve - https://goo.gl/sT68EC
American Express Platinum - https://goo.gl/C9n4e3
If you had $100,000 to save 20 years ago, and you put it into a savings account to save your money in dollars, you would collect a small amount of interest that would not keep pace with inflation.
If you instead saved $100,000 in Gold, you would in 2023 have approximately $475,085 in savings because your Gold, unlike the US dollar, would have retained it's value and purchasing power.
That's what Gold is. It's money. It doesn't compete with investments like stocks or real estate. It competes with other money. Dollars, Euros, Yen, etc…
this didnt age well 🤣
Anyone against gold and silver is a communist .
Update as of 8/11/2023:
Gold: Up 31% since this video was posted
SP500: Up 66.8% with dividends reinvested.
make another video on gold and silver its pretty relevant today
Facts, finally a video that makes sense lol
😂😂😂😂 this little guy
This aged like milk, gold has almost doubled since this vid
You’re a damn fool!!!!!
The reason the US left the gold standard had nothing to do with what you mentioned that is just what the people who print the money tell us. They left the gold standard once they had a monopoly on printing money. They realized they no longer had to have the gold to back their dollar and there was nothign stopping them from printing whatever they wanted without other countries having the ability to do anything but obey. You can stop backing your dollar with gold once you convince everyone that you are backing your dollar with gold.
I love how he is trashing GOLD and SILVER as if it won't go to the moon soon lol… That's ok!!! Keep your money in the bank my friends.
Gold protects your money from inflation.
You better buy gold now 🤣🤣🤣🤣🤣🤣🤣🤣🤣🤣🤣🤣🤣🤣🤣
Worst advice ever 😂😂
From the 1st September 2020 up to now I have spent £10,923.74 on gold and silver it is now priced at £13.244.46 which is a increase of £2,320.72. You are talking out of your ass.
@Graham : Well, you need money to buy when others are fearful right. – GOLD since 2450 BC
If you expect retention of purchasing power, then you expect an increased value in terms of currency, which makes gold an investment. You have to laugh at these wet-behind-the-ears barely out of high school wannabe "experts" who continue to perpetuate the same old blather they hear from other expert parrots. No original thoughts and no real substantial content, just impressing themselves. Look mommy, I'm on YouTube !
2023 😂🎉
In 2011, Goodafi was still acquiring gold for a gold backed pan-African currency, which died along with him in 2012, when fiat money countries which could not afford an honest currency on the world market leveled his country with the highest standard if living in Africa and bombed it back to the stone age.
REVISIT THIS PLS
Why would you use the dollar as a unit of measurement against intrinsic value? That's like measuring human affection in kilograms.
I have been buying gold since the 80’s
I have my hold at my house and my guns . If you pick it up no shipping
Gold and silver is money
I don’t use banks
I stack gold silver and if I need cash I sell a few coins .
Plus it’s Tex free cash for cash 💰
You maintain wealth over time as well.
Reading the comments 🤣🤣🤣they not agreeing with you. Also I think he is trying too help the government or he is trying too
Get all the gold for himself
This is 2022 calling back to 2019! Buy Gold!!
If gold was such a bad investment, why would the rich continue to hoard it.
Gold is an insurance policy, it’s a universal recognized currency and can get it u out of a sticky jam if traveling , having some gold collect as insurance is good and inverse in real estate
a smart idiot
funny how the government fucked up his investments lol, while my gold went up.
Buying gold & silver is not an investment. It's a novelty. You're not going to make much at all. Buying gold and silver is for poor people.
One thing you have to understand is that if the society and the economy collapses, gold and the dollar will be worthless. Once society rebuilds itself, which it likely would, gold would be valuable again.
The current price of gold makes this kid look like a fool.
Update : spot price $1981 troy oz
I do get what he's saying.
Stick to real estate fam you’re ignorant
Super.oke.fratelo.