Market Mad House

In individuals, insanity is rare; but in groups, parties, nations and epochs, it is the rule. Friedrich Nietzsche


Is Physical Gold the “New” Diversifier?

Long before fiat currency or the US dollar were created, people were actively using precious metals such as gold to store their value, buy necessities, and boast their wealth.

Then, when carrying around gold become inconvenient and rather risky, people started to use banknotes that signified a certain amount of gold that they had in the bank. They would pay for things with their banknote, and then the person they paid would be able to head to the bank and turn in that banknote for the specified amount of gold it signified. 

Then came the United States Dollar. Each dollar signified a certain amount of gold the United States had in the bank just like the predated banknote system, meaning each dollar was backed by a certain amount of gold. Once the United States got off the gold standard, things took a turn for the worst.

It was at this moment in history our currency was free to fly off the handle by the hands of any president in charge. In fact, in the last two years, 80% of US dollars in circulation were printed out of thin air. How can this be if the United States dollar is worth something?

News flash, it isn’t. Now a fiat currency, the only thing our dollar is backed by is the politicians who profess it is worth something…. interesting how that works. 

With over 30 trillion dollars in debt, it seems like a good time to hedge your losses and invest in something with intrinsic value. This brings the question – is physical gold the “new” diversifier? The benefits of investing in physical gold are detailed below. 

Hedge Against Inflation

As mentioned above, inflation is through the roof, and storing your value in a currency with so much political influence and damage is not the smartest move. Yet, most Americans have at least 80% of their worth in the stock market or the US dollar.

Not having your worth tied to the inflated dollar and the disaster it will bring on your retirement is a move you won’t regret. There is a finite supply of gold in the world so no matter how much influence certain people in power have they’ll never be able to print or fake more gold than is in existence. 


If all of your wealth is in one asset, it is essentially putting all your eggs in one basket which is heavily frowned upon when investing. Even if you have half your money in the US dollar and half in the stock market, the US dollar crashing will greatly affect both of these investments.

Not to mention a stock market crash, too. The good news is when there is a crash, precious metals move opposite of the stock market and increase in value. To find out more about physical gold as an asset, click here.

Hedge Against Political Disaster

If this past year hasn’t put you on your toes with worry, you must not have been watching the news. Gas is virtually the highest it’s ever been, with no plans of slowing down any time soon.

This is one of the many signals that a political collapse is on its way, taking the citizens of its nation down with it. Printing 80% of US dollars in existence in the past two years can’t help much either, can it?

We are in for a wild ride, and one of this nation’s saving graces will be precious metals, and more specifically, gold. When you have little faith in those in power, hedging against their political success is a necessity. 

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