Threat Of Cyber War - “Other Reason To Own Physical Gold”

Threat Of Cyber War - “Other Reason To Own Physical Gold”

- “Physical gold is a non-digital asset. You can’t attack it with cyberwarfare” – Rickards
- Greek crisis was necessary step towards fiscal unity in Europe
- “Euro creators want to force common fiscal control – Eurobonds”
- Currency wars between U.S. and China may resume next year
- Rickards emphasises importance of holding physical gold
- Eschews “paper gold” in the form of ETFs, futures or unallocated storage
- Gold insurance against “catastrophic event” … “on the horizon”

Author and monetary expert Jim Rickards says that gold, apart from its qualities as a form of insurance against conventional economic crises, is an essential hedge against cyber warfare.

As Rickards astutely points out,

“Physical gold is a non-digital asset. You can’t attack it with cyber warfare, so I think it has another insurance function for investors there.”

“I think it’s always very important to own gold. I’ve recommended that investors have about 10% of their portfolio in the yellow metal.”

He believes that such a proportion will not hurt investors too much even if the price continues its decline but that,

“If I’m right and some catastrophic event is on the horizon, then that 10% would be your portfolio insurance.”

“These products allow the counterparties to terminate the agreement by giving the investor a dollar value of their gains. But that would deprive you of any future gains. You might get cashed out just as the crisis was beginning and not be able to participate in the upside as the crises worsened.”

Rickards is correct in these warnings. If you cannot visit, hold and easily take delivery of your gold in the event of a “catastrophic event” then you do not own gold - rather you are speculating on the gold price.

All financial service and investment providers and indeed gold brokers are at the mercy of and dependent on technology today. However, if you only have one point of contact with your gold - a website - and you cannot buy, sell or take delivery of your gold then you do not own gold as financial insurance and a safe haven asset.

The old adage is correct - if you can't hold it, you don't own it.

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ENDS

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