At this point, stocks better investment or gold?

[moderate libertarian]

For 5-10 year horizon.
Many people lately see gold as a good investment but at these prices does it still make sense to buy gold?
In any case, appreciate your view on what you think is the safe investment in current economic environment.

 

[cubical]

It can be both. I have about half my portfolio in gold bullion and gold miners(and silver) the rest is in foreign and/or energy related stocks. I am researching MLPs as I believe they are probably the best investment out there for the long term, though they are near all time highs and I would wait before entering.

 

[nejar462]

Both are stronger together. Gold and stocks will give you good diversification and protection for the future. For investments you don't need to pick one or the other, diversify!

 

[moderate libertarian]

Thank you both for your ideas.
MLP I had no clue about and just googled. Interesting option, will have to look into it as I'm new to it.

 

[Seraphim]

Both:

Gold/silver as long term cash savings (instead of currency and bonds).

Stocks for growth and productive value.

Peace.

Both are stronger together. Gold and stocks will give you good diversification and protection for the future. For investments you don't need to pick one or the other, diversify!

 

[DamianTV]

for the 10 year horizon, GOLD GOLD GOLD. The Stock Market as we know it will be a thing of the past by then, probably starting this year, with the Debt Ceiling.

---

Edit:

I mean Physical Gold. Gold Bullion. Gold Coins. Gold Gold. No Stock Market Bullshit. If you havent learned your lesson from the Fiat Dollar, a Stock in Gold is no different than Fiat Paper Money. Fuck the laws and rules and regultions. When (not if, when) the shit hits the fan, which I suspect will be well before Dec 21st, 2012, you'll be glad you have real actual physical gold, unlike me.

 

[jds8288]

This is a good question. My favorite source for this sort of thing is the geopolitical and economics expert Richard Maybury. He's the author of "Whatever Happened to Penny Candy" an amazing yet simple book on free market economics and he also authors the newsletter Early Warning Report.

Two years ago I was looking to do some investing in precious metals and he produced a video series on "Buying Precious Metals" at just the right time: http://www.youtube.com/user/RichardMaybury#p/u/14/K5qrKVASvEw

Here's a summary though:
He estimates that Gold is very likely to exceed $3000/oz, silver $50/oz (Early Warning Report sample issue on earlywarningreport.com)
Don't put all your eggs in one basket (basic investment advice). 10% into precious metals is his advice but I felt comfortable with more than that
Buy the REAL thing

 

[Danke]

Don't put all your eggs in one basket (basic investment advice). 10% into precious metals is his advice but I felt comfortable with more than that
Buy the REAL thing

What does he do with the other 90%?

 

[jds8288]

What does he do with the other 90%?

Well for myself I ended up doing about 40% gold/silver

But for the rest? Whatever seems like a good investment to you. I'd put it in strong companies in an industry you are very familiar with. But that's just me. You could do land, mutual fund, stocks, foreign currency, commodities, bonds, CDs (ha, I wouldn't), whatever you want.

Basically I would be take the approach of (and I think it's a pretty reasonable one) what if one of your investments went to 0 - what would your portfolio look like? And then build around that. Obviously we don't expect gold to plummet but if it did you're SOL. But if gold doubles or triples and it's 20% of your portfolio you're doing really, really well. Even if the bottom falls out of the dollar you'll still be set pretty good because guess what most people don't have? Gold and silver. Precious metals are also pretty volatile so that's a very good reason for not putting a huge chunk of your assets in them.

 

[Carson]

That is a real tough question.

With all of the volatility in the business sector I would think gold and silver will still be gold and silver no matter how things go.

I suppose with things changing there could be a chance of seeing it through owning a business that is still in business and make a killing. The thing is though that there are people that have the ability to create what ever amount of money it takes to take it away from you.

I remember a story about Hostess and the way their parent company was able to get to be such a popular brand off bread.

The story went that all over the country, and I imagine the world for that matter, that every town had a bakery or more baking bread for the local market. Hostess was able to move into the town, set up and sell bread at a price that would eventually under-price the local people and drive them out of business. They had a lot of money and could afford to do it. Then they could charge what ever the market would bear. Then they would move on to another town.

Here is how the stock market has been running. Might I point out that when the value of the dollar drops in half it takes twice as much to purchase the same amount of stock. It can be exhilarating owning it and watching it go up. Until you've let the government cut itself in with the capital gains tax and then look back and see it was false profits created by the illusion of inflation.

While your at it check out on the chart where you were when you started working without any experience and look now how, even though you've gotten raises over the years you make less than when you started.

http://oregonstate.edu/cla/polisci/sahr

Silver and Gold calculator.

 

[Teaser Rate]

Gold is not an investment, it's a hedge. Putting anything more than ~10% of your portfolio in gold is pointless unless you believe that the dollar is about to crash.

 

[MJU1983]

Gold is not an investment, it's a hedge. Putting anything more than ~10% of your portfolio in gold is pointless unless you believe that the dollar is about to crash.

Thanks to the Fed it seems to be a pretty decent investment as of late.

 

[Carson]

Thanks to the Fed it seems to be a pretty decent investment as of late.

Train wreck in slow motion.

Hindenburging into the future.

 

[Danke]

Well for myself I ended up doing about 40% gold/silver

Not my question. Was wonder what your so-called "geopolitical and economics expert" Richard Maybury did/does.

10% gave me the lol.

Gold is not an investment, it's a hedge. Putting anything more than ~10% of your portfolio in gold is pointless unless you believe that the dollar is about to crash.

LOL

 

[RonPaulGetsIt]

gold better...just watch the dow/gold ratio until it falls back to 1:1.

1 to 1 in 1980 when gold peaked, dow bottomed...both around 850.

hit about 44 to 1 in 2000 when gold bottomed about 250, dow 11000.

It has been on a slow march lower since and should continue to 2:1 at a minimum from its current 7-8 ish to 1.

 

[Teaser Rate]

LOL

That fact that something goes up or down in value does not mean it's an investment. Is wheat an investment? Is rice? Is sugar?

An investment is money placed into something which will generate revenue later on. Gold derives most of its value from speculation, and like overpriced houses during the last bubble, its value will come back down once the market realizes that.

 

[Danke]

That fact that something goes up or down in value does not mean it's an investment. Is wheat an investment? Is rice? Is sugar?

An investment is money placed into something which will generate revenue later on. Gold derives most of its value from speculation, and like overpriced houses during the last bubble, its value will come back down once the market realizes that.

$250 to $1600 in ten years while the S&P 500 has been flat. Ya, poor investment.

 

[Carson]

That fact that something goes up or down in value does not mean it's an investment. Is wheat an investment? Is rice? Is sugar?

An investment is money placed into something which will generate revenue later on. Gold derives most of its value from speculation, and like overpriced houses during the last bubble, its value will come back down once the market realizes that.

"First you get the sugar, then you get the power, then you get the women"

 

[Fermli]

"First you get the sugar, then you get the power, then you get the women"

ahaha i can't stop laughing.

 

[jds8288]

Not my question. Was wonder what your so-called "geopolitical and economics expert" Richard Maybury did/does.

10% gave me the lol.

He's not a "so-called" expert. He's just not well known. Ron Paul is a subscriber of "Early Warning Report". You should really read the sample issue

But since you ask about what would Early Warning Report suggest for an investment: the answer is I don't know. I don't have $150/yr to spend on it. But if I was regularly investing I sure would.

However, his Track Record gives a pretty good indicator

and a major part of his recommendation is Permanent Portfolio (PRPFX) which has clearly done very well since inception.

Based on your slight scoffing about the 10% in gold I'm guessing you'd prefer 100%? I haven't figured out what your angle is yet.

$250 to $1600 in ten years while the S&P 500 has been flat. Ya, poor investment.

Why the focus on s&p vs gold? Silver has increased at a higher %. Also you can invest in stocks and do better than indexes (s&p, nasdaq, dj).