Get all cash out of the bank

[TheHeathens]

It's nice to know you've finally conceded that diversification is not necessarily good.

No I haven't. You're doing that spin thing again, and it's getting really tiresome. What I actually did was shoot your argument about diversification to pieces - you were talking about randomly diversifying a portfolio which is clearly not what you'd (well maybe you would, but most people certainly wouldn't) do.

As far as I was aware there was no VAT on gold for investment purposes. You state that gold has lost its value(40%)recently but that misses the point. The point is gold like silver or platinum is a safe store of value.

Depends on the purity of the gold. Investment gold is gold in bar or wafer form that is of a purity too high for jewellery but also includes some gold coins. Plus, I didn't say gold had lost 40% of it's value - read it again. I said what would happen if you'd put all your money in gold based on your apocalyptic vision, and gold then lost 40% of it's value (for example), but the economy recovered?

Whilst governments are printing money the gold will increase in value, provided the printing is in excess of growth in the economy. When the governments are not printing money, the price of gold decreases.

Gold in other words will approximately buy you the same amount of goods regardless of the status of the pound or dollar. People at the moment want to protect their savings from government confiscation(borrowing). They can't do this with stocks and shares at the moment, and they can't do it by investing in a gold fund.

So when are Tesco & Sainsburys going to start accepting Kruggerands?

Why can't you do it by investing in a gold ETF then? It's backed by gold and it tracks the gold price so it in effect acts as, gold.

In fact those who invest in a gold fund whilst the current crisis unravels are asking for trouble. I know this because of the principles involved, and also because I've seen a forum discussion about this subject, and some of the people are saying exactly the same as what I'm saying. Mainly that when you try to get your gold out there is no gold.

Oh! Well if you've seen a forum discussion on it!!! Why don't you post the link to this forum discussion so we can see it for it's own merits?

You're really missing the point about funds and I'm not convinced you know much about them at all (and I'm not just talking gold funds). What exactly are the principles then?

Also, how can you 'get your gold out' of an ETF? Although it's backed by gold, you're only an actual creditor on the gold if the company running the ETF goes into liquidation, which as far as I'm aware has never happened as ETFs have only been around for a few years.

I suggest that if you have an interest in investments, sitting the CF2 exam offered by the Chartered Insurance Institute (CII), which is an introduction to investments and investment principles.

As I've said in previous posts, I do think that gold has a place in an investment portfolio (I've got exposure to it in my pension) but there is more than one way to skin a cat. Plus, the reasons you are giving to physically hold gold are based on financial meltdown which is still very very unlikely whatever the current financial situation (and the FTSE hit 11 year lows today - which just shows the dangers of having all of your investments in UK shares).