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B4 The Bell Turdsday


Guest yobob1

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Great thoughts yobob and sphinxter!

 

debt gona sink the ship :o

 

 

only thing I can't get behind 100% is POG

 

in a deflation enviroment.I mean like gold drops to 250.00

 

wont that 250.00 buy alot more than it will now with POG 410?

 

then there is the other thought when bonds and paper burn

 

POG will shine???

Yeah, I've worried about gold in a deflationary environment ever since reading "Conquer the Crash" by Prechter.

 

But here's what I've come to believe.

 

In a full blown deflationary crisis where gold goes to $250, cash would be a far better investment.

 

But how wouuld you hold cash? In a bank? You mean like in Argentina where people were forbidden from accessing their cash because it would have wiped out the banks?

 

Even if you have your cash stuffed in an A rated bank, there is no guarantee that you will have access to it.

 

If you have your cash in a lesser bank, or merely one that is unfortunate, remember that FDIC is private insurance, albeit regulated, and has enough assets to cover approximately 5% of all assets and is, by law, required to pay out up to $100k per account at a minimum of 5% per year.

 

So if you have your cash in a bank that goes under there is some chance that over the next 20 years you may eventually get it all back. Of course, FDIC could simply go under too.

 

The other alternative is to hold big piles of cash around the house but that seems a tad risky.

 

You could hold it in a safe deposit box unless you are a client of Washington Mutual which has a new policy forbidding the holding of cash and precious metals in their boxes. A Patriot act sponsored rule that is being emulated by other banks across the nation.

 

So, in summary, I think having direct access to $250 gold in a deflationary explosion will be a magnificent investment.

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