How to invest in gold and silver?
How to invest in gold and silver? Anyone with such a question can find the answer with detailed justification in Michael Maloney's book of the same title.
Investing in precious metals has not been a very popular way to multiply your wealth recently. The mainstream media is eager to keep silent about this topic, as a result of which the public opinion is convinced that the yellow metal is unattractive and the profitability of investing in it is very low. Meanwhile, after taking into account all factors, this profitability, especially in the long term, several years, is not so low. With admirable enthusiasm, Maloney bombards the reader with arguments about the advantages of investing in gold. He often refers to historical facts. Examples cited in past times are Athens, the Roman Empire, the Weimar Republic, and many others. Of particular interest and thought is the case of the Roman Empire under Diocletian. Due to the watering down of gold at the time by adding less precious metals like copper and bronze to coins, inflation raged to unmanageable proportions. As a result, the production of any goods became more "expensive" and the prices of all products began to increase parabolically. It is not difficult to guess that this caused general discontent and strong pressure on the ruler to put an end to it. Diocletian reacted, but unfortunately his intervention only made matters worse. Instead of stopping the corruption of money, as logic would have it, the Emperor in 301 issued an edict prohibiting price increases. The penalty for disobeying this law was the death penalty! However, this did not stop the further increase in prices, but fearing for their lives, many entrepreneurs raised the white flag and ceased their business activity. As they lost their source of income and had no means of subsistence, they had no choice but to accept benefits, join the army and expand the public administration sector. This, of course, further strained the already dilapidated budget. In this way, the foundations of socialism were born and the growth of bureaucracy, always having only negative consequences, was born.
One gets the impression that Diocletian apparently did not know the laws of economics and tried to put out the fire with gasoline canisters, and when the fire escalated he ordered his servants to bring even more canisters. Is this an isolated case? If one carefully traces the history of many empires, one will discover with disbelief that this pattern repeats itself very often. Apparently, the rulers do not know history and cannot draw conclusions from it, learning from the mistakes of others. They prefer to learn from their mistakes, as if they had a lot of fun doing it. Of course, the whole society suffers from this. Maloney puts it in concrete numbers. During the reign of Diocletian in 301, a pound of gold cost 50,000 denarii, and almost half a century later it was worth 2.1 billion denarii. That's an increase of more than 40,000 times! This prevented trade through the use of the currency (the denarius) and forced people to return to barter, not without its many disadvantages.
What does it look like in more modern times? Unfortunately, at present the costs of the expanded administration are very high. Before Franklin Delano Roosevelt took over the presidency, they accounted for only a few percent of the economy, today it is several dozen percent and this trend is still growing. In 1971, an ounce of gold cost about $40. Fifty years later, it costs over $1,800. Isn't this similar to the situation in the reign of Diocletian?
In his book, Maloney also pays a lot of attention to gold's younger brother, silver. An investment in them may be of greater interest to the average person because the costs to be incurred in connection with the purchase of one ounce are much lower than in the case of gold. This impression is perfectly justified. Most of the time, the ratio of one ounce of gold to silver was one to a dozen. Meanwhile, today it is 1:70! This means that silver is extremely undervalued relative to gold. In addition, silver is widely used in industry. It is used in batteries, catalytic converters, bearings, electrical conductors and many, many more. Therefore, the demand for this metal will be all the time. In addition, its stocks are currently at a very low level. Theoretically, more could be mined or new mines opened. However, silver resources mainly come from mines of other metals, such as gold, copper, zinc and lead. It is therefore a “side effect” of mining these metals. On the other hand, opening a new mine is a process of several years from the moment the silver resources are discovered, so if the demand for them increases sharply, it will not be possible to meet the needs. As a result of these shortages, the price of the metal could explode. Bearing in mind the above facts, it can be concluded that silver, no worse than gold, can very effectively preserve the purchasing power of our money. Perhaps in times of accelerating inflation it will work even better than the yellow metal.
“Investing in gold and silver” is a valuable item not only for people interested in the world of finance, but also for ordinary people. It is obvious that no one likes to be deprived of their hard-earned savings as a result of the depreciation of money. I will even risk saying that for the latter, the conclusions drawn from reading and their skilful application in practice may turn out to be much more valuable than for traditional investors. They are motivated only by the multiplication of wealth. For the latter, it may be a chance to avoid living in poverty.
Piotr Szewczyk
If you liked the text, I invite you to visit my website, where you will find other thoughts/reviews on valuable books: https://kilkaslowoksiazkach.pl/
How to invest in gold and silver? Anyone with such a question can find the answer with detailed justification in Michael Maloney's book of the same title.
Investing in precious metals has not been a very popular way to multiply your wealth recently. The mainstream media is eager to keep silent about this topic, as a result of which the public opinion is convinced that the yellow metal is unattractive and the profitability of investing in it is very low. Meanwhile, after taking into account all factors, this profitability, especially in the long term, several years, is not so low. With admirable enthusiasm, Maloney bombards the reader with arguments about the advantages of investing in gold. He often refers to historical facts. Examples cited in past times are Athens, the Roman Empire, the Weimar Republic, and many others. Of particular interest and thought is the case of the Roman Empire under Diocletian. Due to the watering down of gold at the time by adding less precious metals like copper and bronze to coins, inflation raged to unmanageable proportions. As a result, the production of any goods became more "expensive" and the prices of all products began to increase parabolically. It is not difficult to guess that this caused general discontent and strong pressure on the ruler to put an end to it. Diocletian reacted, but unfortunately his intervention only made matters worse. Instead of stopping the corruption of money, as logic would have it, the Emperor in 301 issued an edict prohibiting price increases. The penalty for disobeying this law was the death penalty! However, this did not stop the further increase in prices, but fearing for their lives, many entrepreneurs raised the white flag and ceased their business activity. As they lost their source of income and had no means of subsistence, they had no choice but to accept benefits, join the army and expand the public administration sector. This, of course, further strained the already dilapidated budget. In this way, the foundations of socialism were born and the growth of bureaucracy, always having only negative consequences, was born.
One gets the impression that Diocletian apparently did not know the laws of economics and tried to put out the fire with gasoline canisters, and when the fire escalated he ordered his servants to bring even more canisters. Is this an isolated case? If one carefully traces the history of many empires, one will discover with disbelief that this pattern repeats itself very often. Apparently, the rulers do not know history and cannot draw conclusions from it, learning from the mistakes of others. They prefer to learn from their mistakes, as if they had a lot of fun doing it. Of course, the whole society suffers from this. Maloney puts it in concrete numbers. During the reign of Diocletian in 301, a pound of gold cost 50,000 denarii, and almost half a century later it was worth 2.1 billion denarii. That's an increase of more than 40,000 times! This prevented trade through the use of the currency (the denarius) and forced people to return to barter, not without its many disadvantages.
What does it look like in more modern times? Unfortunately, at present the costs of the expanded administration are very high. Before Franklin Delano Roosevelt took over the presidency, they accounted for only a few percent of the economy, today it is several dozen percent and this trend is still growing. In 1971, an ounce of gold cost about $40. Fifty years later, it costs over $1,800. Isn't this similar to the situation in the reign of Diocletian?
In his book, Maloney also pays a lot of attention to gold's younger brother, silver. An investment in them may be of greater interest to the average person because the costs to be incurred in connection with the purchase of one ounce are much lower than in the case of gold. This impression is perfectly justified. Most of the time, the ratio of one ounce of gold to silver was one to a dozen. Meanwhile, today it is 1:70! This means that silver is extremely undervalued relative to gold. In addition, silver is widely used in industry. It is used in batteries, catalytic converters, bearings, electrical conductors and many, many more. Therefore, the demand for this metal will be all the time. In addition, its stocks are currently at a very low level. Theoretically, more could be mined or new mines opened. However, silver resources mainly come from mines of other metals, such as gold, copper, zinc and lead. It is therefore a “side effect” of mining these metals. On the other hand, opening a new mine is a process of several years from the moment the silver resources are discovered, so if the demand for them increases sharply, it will not be possible to meet the needs. As a result of these shortages, the price of the metal could explode. Bearing in mind the above facts, it can be concluded that silver, no worse than gold, can very effectively preserve the purchasing power of our money. Perhaps in times of accelerating inflation it will work even better than the yellow metal.
“Investing in gold and silver” is a valuable item not only for people interested in the world of finance, but also for ordinary people. It is obvious that no one likes to be deprived of their hard-earned savings as a result of the depreciation of money. I will even risk saying that for the latter, the conclusions drawn from reading and their skilful application in practice may turn out to be much more valuable than for traditional investors. They are motivated only by the multiplication of wealth. For the latter, it may be a chance to avoid living in poverty.
Piotr Szewczyk
If you liked the text, I invite you to visit my website, where you will find other thoughts/reviews on valuable books: https://kilkaslowoksiazkach.pl/
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