Tuesday, July 03, 2012
So You Think You Own Some Gold?
Think again!!
Many "investors" who believe they have purchased "gold" and hold it in the form of certificates issued by bullion banks around the world will find that delivery of the physical precious metal is impossible. This is due to what amounts to a "fractional reserve" situation similar to the currency system engaged in by all commercial banks.
When such "investors" demand physical delivery of the actual metal to their vault outside the banking system the bullion bank will substitute paper banknotes or electronic digits equal to the manipulated market price of the gold. The reason for this is that there is insufficient metal in existence to equal the number of ounces for which certificates have been issued.
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The "lucky" few who even receive worthless, inflated banknotes. I feel certain most will not even receive those.
I would never "invest" in any commodity of which I did not have physical possession, but especially precious metals.
As I have mentioned elsewhere, although I put many thousands of dollars into my Federal 401k (Thrift Savings Plan - what most Federal employees like my fellow VA medical workers were permitted in lieu of an actual retirement), I have no doubt whatsoever that the Feds have spent every penny placed into TSP's coffers, issuing IOUs in place of that money, just as they did with Social Security.
I believe they have done the same with the few dollars of retirement they provide since they changed the system to FERS. I do not collect retirement from the VA, but friends who were planning on it discovered that they have to wait for TWO YEARS after they retire before the Feds will start paying them. That money was spent also, so they are kicking the can down the road a little further.
I didn't put much into precious metals, but what I did I physically possess. Most of my assets are in physical commodities, other than some real estate - which I don't actually possess, since it is rented via taxes.
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