How safe is digital gold?

UndercoverElephant · Post by **UndercoverElephant** » 17 Jul 2008, 20:52

http://www.goldmoney.com/en/essays/own-metal.html

Post by **adam2** » 18 Jul 2008, 09:01

I would not trust any such scheme, quite apart from the risk of fraud or failure, what about the risk of the governmemt requistioning or stealing gold "hoarded by the idle rich" perhaps because they need said gold to pay russia for gas or oil?
We cant have babies freezing while gold is being hoarded can we!

The private ownership of gold coins, purchased for cash, has much to commend it, tell no one, and hide it well against theives.

A stash of food, fuel, blankets, candles, warm clothing, seeds and tools etc is more likely to save your life than a few gold coins.
If however you already have stocks of the above, then gold is worth considering.

SILVERHARP2 · Post by **SILVERHARP2** » 18 Jul 2008, 11:22

they are a very reputible company and might suit someone who wanted to treat it like a savings account or someone who doesn't have access to good storage. Check out Financialsense.com, they have been profiled on interviews on a regular basis

That being said going to gold shows and picking up some standard gold coins like half soverigns is excellent also as there is no paper trail

UndercoverElephant · Post by **UndercoverElephant** » 18 Jul 2008, 13:36

SILVERHARP2 wrote:they are a very reputible company and might suit someone who wanted to treat it like a savings account or someone who doesn't have access to good storage.

That is exactly why I am thinking of using it. I have sold my house and I'm looking for places to keep the money while I wait for the housing market to stabilise at a lower level. Seems to me like buying gold is far more likely to earn me a nice return on my money, but I've got nowhere safe to put it.

Vortex · Post by **Vortex** » 18 Jul 2008, 13:44

I've got nowhere safe to put it.

By chance, my real name is Crown Prince Yur Muni Eez My Muni.

I come from Nigeria where I have quite a lot of money inadvertently frozen in a bank account.

All I need to release this money is an Special Access Fee of some £20,000.

If you lend me this amount I will go and fetch my funds, and I will refund your £20,000 plus an additional £20,000 for your trouble.

If you are interested please meet me at the bus stop outside my offices in Kentish Town next Tuesday evening at 11:30PM.

Please bring the money with you - it will need to be cash.

yours most honorifically, nostalgically & esteemably,

Crown Prince Muni

UndercoverElephant · Post by **UndercoverElephant** » 18 Jul 2008, 14:57

Vortex wrote:
I've got nowhere safe to put it.
By chance, my real name is Crown Prince Yur Muni Eez My Muni.

I come from Nigeria where I have quite a lot of money inadvertently frozen in a bank account.

All I need to release this money is an Special Access Fee of some £20,000.

If you lend me this amount I will go and fetch my funds, and I will refund your £20,000 plus an additional £20,000 for your trouble.

If you are interested please meet me at the bus stop outside my offices in Kentish Town next Tuesday evening at 11:30PM.

Please bring the money with you - it will need to be cash.

yours most honorifically, nostalgically & esteemably,

Crown Prince Muni

I think I'll pass on that one, Muni.

Andy Hunt · Post by **Andy Hunt** » 18 Jul 2008, 15:41

Muni Muni Muni . . . must be funny in a rich man's world.

UndercoverElephant · Post by **UndercoverElephant** » 18 Jul 2008, 15:55

Andy Hunt wrote:Muni Muni Muni . . . must be funny in a rich man's world.

I've never actually felt rich before this point. I was wondering how I could keep paying the mortgage. In my whole life I've never had more than £2000 in savings. Now I have to figure out what to do with 120K immediately before an economic catastrophe. I guess it's a nice problem to have...

skeptik · Post by **skeptik** » 18 Jul 2008, 17:00

UndercoverElephant wrote:
Andy Hunt wrote:Muni Muni Muni . . . must be funny in a rich man's world.
I've never actually felt rich before this point. I was wondering how I could keep paying the mortgage. In my whole life I've never had more than £2000 in savings. Now I have to figure out what to do with 120K immediately before an economic catastrophe. I guess it's a nice problem to have...

Whatever you decide to do, do NOT put it all in one basket. Think Northern Rock, Bradford & Bingley and Alliance & Leicester ( the purchase of the latter looks like a hidden bailout by proxy to me - where did an already stressed Spanish bank like Santander get the dosh to afford A&L from?) and others in the USA too numerous to mention. "You can bank on it" doesn't have quite the same reassuring ring as it used to. Spread it around a bit. UK Bank failure insurance via FSCS will only cover you up to £35,000 per organization that you have money deposited with. As a short term expedient while you are thinking, Id suggest 4 x 1 month deposit accounts with 4 different banks - and make sure that they are not subsidiaries of the same parent company. Then don't rush your thinking! You can never do too much research.

http://www.fscs.org.uk/consumer/FAQs/De ... aims_FAQs/

I'm 90% € deposit accounts and 10% commodities at the moment. Too nervous to be any more adventurous. If I get wiped out in a commodities crash I'd be well pissed off, but I could afford it. As it is the fund has done well since I bought into it.

MacG · Post by **MacG** » 18 Jul 2008, 17:34

Gold is for optimists.

UndercoverElephant · Post by **UndercoverElephant** » 18 Jul 2008, 17:39

MacG wrote:Gold is for optimists.

It will go up in value before it goes down. I just need somewhere to put some money for 18 months or so until house prices have come down. I don't intend to leave that equity in gold after that. I intend to buy another house. It just seems to me that one of the places I should put it is in gold, because I'm convinced that as the price of oil goes up it will be tracked by the price of gold. That is what it has been doing up until now. So if you believe we are at peak oil, gold is a no-brainer, isn't it? If I leave it in a high-interest savings account the maximum I'm going to gain in interest about 2% after tax and inflation. If I buy gold the first time it dips after I get the money, I can't lose...can I? The price of gold could go up by 50%.

Vortex · Post by **Vortex** » 18 Jul 2008, 17:56

I can't lose...can I?

I shall this just once - and it IS meant kindly - don't be a twit.

Just put that money somewhere safe - not in gold.

(I once had a tip on a surefire share - I lost my whole investment. That's how the 'professionals' pay for their Porches ... ripping off mugs like us.)

UndercoverElephant · Post by **UndercoverElephant** » 18 Jul 2008, 17:59

I'm not going to put all of it in gold.

I'm not thinking of buying it because somebody else tipped me off. It is a direct consequence of believing peak oil is here. Matt Simmons isn't trying to rip me off.

Vortex · Post by **Vortex** » 18 Jul 2008, 18:10

UndercoverElephant wrote:

I'm not going to put all of it in gold.

I'm not thinking of buying it because somebody else tipped me off. It is a direct consequence of believing peak oil is here. Matt Simmons isn't trying to rip me off.

"You invested in WHAT?"

skeptik · Post by **skeptik** » 18 Jul 2008, 19:07

UndercoverElephant wrote:

I'm not going to put all of it in gold.

backing up Vortex here. First question to ask yourself. How much can I afford to lose? When you've managed to be honest with yourself. (difficult!) subtract that from your 120,000 and do whatever you feel like with it. Put the rest somewhere safe. Personally I regard gold as a commodity. Its price has and will show violent short term movements and its value is entirely contextual.