@Kingran just posted on the new precious metals board that he has become interested in investing in precious metals for the first time. He even posted links to lurid clickbait videos.
Now, don’t get me wrong. I have been a gold bug since earliest memory. Silver, too. My husband gave me a wedding present of 100 ounces of silver bullion coins (each packed in its own plastic case) because our ketubah mentioned 100 zuzim. (An ancient silver coin – a song mentions that you can buy a goat for 2 zuzim.) Tucked away in my safe deposit box.
That being said, both gold and silver are in classic bubbles. This isn’t the first time. It’s a trap for speculators. The price may be driven by a temporary need to amass the metal which will recede when the supply chain bottleneck eases.
When you say you are “with a bank” what do you mean? If you mean that you have a savings account and your bank is FDIC insured it doesn’t matter what its assets are. Your savings account will be protected up to the FDIC limit even if the bank collapses.
If you mean that you are a shareholder and own stock…that’s a different story.
FWIW, I don’t buy commodities. Their price ultimately is entirely whim. A company has an intrinsic value (assets, booked sales, etc). Gold really doesn’t.
I won’t criticize those who buy gold. People have success doing that. I don’t get it. And William Devane’s ads don’t fill me with confidence (i.e. seems like a scam when he presents it on TV, even though it probably isn’t).
To me, gold is a non-corroding metal that is an excellent conductor (and makes pretty rings).
Frankly, many are merely repeating what WEB said. No companies have some asset, whose value can also change. Gold is an international currency for 2000 years, and saying it doesn’t have value is not correct. When the central banks are buying gold, you need to rethink how you view gold.
This doesn’t mean you should invest, but don’t dismiss it has no intrinsic value.
If FDIC isn’t there, everything will have collapsed, and money will be worthless anyway.
My bigger concern is that the FDIC has a pretty low limit, by modern standards. $250K isn’t that much today. I suspect most people on TMF have more than that, and anything above the $250K limit is unprotected.
I took 1poorguy’s comment concerning intrinsic value as investment nomenclature as in the true, fundamental worth of an asset, calculated by analyzing its future cash flows, growth potential, and risk, independent of its current market price.
We a lot less at a couple of banks; our fast liquidity needs are not great. Much larger accounts are spread around at non-bank institutions. SIPC insurance covers up to $500K per.
I believe SIPC (and FDIC) only cover per customer at a given firm. So, if you -for example- bank at Fido, and have a brokerage at FIDO, your coverage is capped. You have to spread it among multiple firms if you have more than the specified limit (either $250K or $500K, depending). Correct?
That is correct (as far as I know). Using multiple institutions is useful, as are multiple accounts. You might have an individual account plus a joint account with your spouse. Each would have a separate $500K limit.
