10/30/2007

Gold is a financial catastrophe insurance

There is an increasingly wide range of methods available to investors wanting to buy gold, or gain exposure to gold price movements. From gold coins to complex structured financial products, the most appropriate way will depend on the requirements and outlook of the individual investor.

My reasoning for my interest in gold bars is a little unique. I've tried to avoid the cliché stories about gold and gold bars. They're the easy stories to tell you. I'm avoiding them because, quite frankly, the easy stories gold bugs sell you are not the reason I'm buying.

I buy gold bars because, first of all, I believe that gold is cheap. Gold is a financial catastrophe insurance. And we haven't had a financial catastrophe in the U.S. in 25 years. I'm not predicting financial catastrophe, here. I'm simply buying catastrophe insurance, when it's at its cheapest.

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