Author Archives: USAGOLD

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The USAGOLD Website
A guiding light for our current and would-be clientele since 1997

graphic image of light house beaming
Welcome newcomers!

When the USAGOLD website was established in 1997, there was no Google, no Facebook, no I-Tunes, no Amazon. Instead there was just a handful of scattered websites trying to figure what this new technology was all about and how it could be used to some advantage.  We were among that group.  Our idea of innovation in those early days was two spinning globes on either side of the USAGOLD logo.  We marveled at it; considered it state of the art.

But being among the first on the internet to have spinning globes was not our only achievement. We were also among the first to sponsor a Daily Market Report (1996), a Discussion Group (1997), Live Prices and Charts (2007) and a Mobile Website (2011) – to mention just a few of our ground-breaking internet ventures.  We await the next wave of innovation so that we can offer even more value to our regular visitors.

Through our 23-year presence on the world wide web, the philosophy underlying our website has always been a simple one – to act as a guiding light for our current and prospective clientele by providing a state of the art information portal coupled with a reliable and competitive brokerage service.  We had and still have no aspirations beyond that, and that pinpoint focus has paid dividends beyond anything we would have imagined in 1996.

From a humble beginning, we have grown to almost 800,000 visitors per month currently and there have been times when that count has been significantly higher. USAGOLD today remains one of the most highly referenced and visited web portals in the gold business. We once had a client tell us of visiting the Gold Souk in Dubai and being surprised that so many merchant stalls had USAGOLD on their computer screens. 

If you would like to gain a better understanding of what USAGOLD has to offer to you as a current or prospective client, the menu at the top of the page is a good place to start. 


Interested in gold but struggling to find the right firm?
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ORDER DESK: 1-800-869-5115 x100/orderdesk@usagold.com

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Short and Sweet

Of 17th-century tulips, 21st-century stocks and ageless gold

antique painting of a fool trading his gold for tulip bulbs

During the Dutch Tulipmania, the price of one special, rare type of tulip bulb called Semper Augustus sold for 1000 guilders in 1623, 1200 guilders in 1624, 2000 guilders in 1625, and 5500 guilders in 1637. Shortly thereafter, the bottom fell out of the market and prices plummeted to 1/200 of their peak price – a mere 27 guilders. In the artwork above an individual, portrayed in fool’s garment, is shown trading a hefty pouch of gold for a handful of tulip bulbs. It is no mystery who got the better part of that bargain. History teaches us that no era is immune to financial mania including our own. As a matter of fact, a good many believe that we are fully immersed in a stock market mania (wherein many include bitcoin) right now.

Since the earliest days of the USAGOLD website (the mid-1990s), we have enshrined a quote from Thomas Bailey Aldrich at our home page: “The possession of gold has ruined fewer men than the lack of it.” Aldrich’s axiom has held true down through the ages. It applied in ancient Greece and Rome, in 11th century China, in the time of the Medicis, the Dutch Tulipmania, the South Seas Bubble and French fiat money mania, during the long string of panics in the late nineteenth and early 20th centuries (Aldrich’s time), the spate of post World War I and II hyperinflations (Austria, Germany, Greece, Hungary, et al)  and it still applies today.


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Gold is the investment for All Seasons

Looking to prepare your portfolio for whatever uncertainty lies ahead?
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Short and Sweet

Gold in the age of inflation
The star investment of the fifty-year era and the most reliable store of value

There has been considerable, and some would say tedious, discussion on the subject of inflation over the past several weeks. The Fed wants it. The markets await it. Investors and consumers worry about it. If it does come, the Fed thinks it will be transitory. Others believe it will persist. That said, the current discussion ignores an established historical reality: We already live and have lived with it for a very long time. The Age of Inflation began in August of 1971 when the United States disengaged the dollar from gold and ushered in the fiat money era. Thereafter, the inflationary process has progressively eaten away at our wealth and the purchasing power of our money. Now, some of the best minds in the investment business tell us that it is about to accelerate and that if we ignore it, we do so at our own peril.

To mark the occasion of the fiat money system’s golden anniversary, we offer two instructive charts. One is something of a myth-buster in that gold has decisively outperformed stocks during the fiat money era. Many will be surprised to learn that gold is up 4,500% since 1971, while stocks have played second fiddle at 3,375%. The other reveals at a glance the pernicious, ongoing debasement of the dollar and gold’s role as a hedge against it. The dollar lost 85% of its purchasing power since 1971, while gold, as just mentioned, gained nearly 4500%. If that does not serve as vindication of gold’s portfolio role in the era of fiat money, I don’t know what will. At the same time, consensus has it that cyclically, stocks are closer to a top than a bottom, and gold is closer to a bottom than a top.

Gold and stocks price performance
(In percent, 1971-2021)

area charat showing gold and stocks 1971 to June1 2021 in percent

Chart courtesy of TradingView.com • • • Click to enlarge

Gold and the purchasing power of the dollar
(1971 to present)

overlay area chart showing the value of the dollar and gold since 1971

Sources: St. Louis Federal Reserve [FRED], Bureau of Labor Statistics, ICE Benchmark Administration • • • Click to enlarge

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Celebrate the fifty-year anniversary of the fiat money system with a gold purchase
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Reliably serving physical gold and silver investors since 1973

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Thinking about buying gold and silver?


Gold in six easy lessons

1. Don’t buy it because you need to make money; buy it to protect the money you already have.

2. Don’t look at price as a barrier; look at it as an incentive.

3. Don’t buy the paper pretenders; buy the real thing in the form of coins and bullion.

4. Don’t fall prey to glitzy TV ads; do your due diligence instead.

5. Don’t allow naysayers to divert your interest; allow yourself the right to protect your interests as you see fit.

6. Don’t forget the golden rule: Those who own the gold make the rules!


Looking to prepare your portfolio for whatever uncertainty lies ahead?
DISCOVER THE USAGOLD DIFFERENCE
ORDER DESK: 1-800-869-5115 x100/orderdesk@usagold.com

ORDER GOLD & SILVER ONLINE 24-7

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Short and Sweet

How to spot a bubble
‘Amount of leverage in U.S. equity markets now easily the highest in history.’

Ramirez cartoon of Wall Street blowing speculative trading bubble
Cartoon courtesy of MichaelPRamirez.com

“If you want my opinion,” writes Hussman Fund’s John P. Hussman in a recent analysis, “I suspect that a near-vertical market plunge on the order of 25-35% is coming, probably quite shortly, most likely out of the blue, as in 1987, driven by nothing more than the sudden concerted effort of overextended investors to sell, and the need for a large price adjustment in order to induce scarce buyers to take the other side. As usual, no forecasts are necessary. … This dysfunctional behavior isn’t about any particular video game retailer. I suspect it’s actually about some sort of fragility or segmentation in order-flow mechanisms, possibly coupled with poorly managed derivatives exposure. As I used to teach my students, show me a financial debacle, and I’ll show you someone who had a leveraged, mismatched position that they were suddenly forced to close into an illiquid market. Though my concerns run far beyond the amount of leverage in the system, it isn’t helpful that the amount of leverage in the U.S. equity markets is now easily the highest in history.”

These days spotting the bubble is about as difficult as finding it in the Ramirez cartoon above. Hussman attacks Wall Street’s new rationalization of buying into the bubble, i.e., extreme valuations are justified by low interest rates. Those who are all-in for fear of missing out – blindly walking on air – are obviously the most vulnerable. When investing becomes a matter of faith, that faith will be tested. A solid diversification, we will add, would blunt the downside. Though investor margin debt is small compared to the leverage funds and institutions deploy in the market, it does serve as a bellwether for analysts looking for what might trigger a market crash. SentimenTrader’s Jason Goepfert recently posted a warning to his readers that at $831 billion, we are fast approaching a “year-over-year growth rate in [margin] debt – on both an absolute scale and relative to the change in stock prices – will compare with some of the most egregious extremes in 90 years.”


Are you worried about the egregious extremes in the stock market?
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ORDER DESK: 1-800-869-5115 x100/orderdesk@usagold.com

ONLINE ORDER DESK-24/7

Reliably serving physical gold and silver investors since 1973

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How to choose a gold firm
It may be the most important choice you make as a gold owner

photo shows choosing a king on the chessboard

It is surprising how many prospective investors simply dive into gold and silver investing without much in the way of a consumer inquiry. That lack of simple due diligence has ended up costing a good many investors thousands of dollars, and sometimes even hundreds of thousands before the damage is detected.

Here you will find some brief but useful guidelines
to help
you choose the right gold and silver company.


To end right, start right.
DISCOVER THE USAGOLD DIFFERENCE
ORDER DESK: 1-800-869-5115 x100/orderdesk@usagold.com
ONLINE ORDER DESK-24/7

Reliably serving physical gold and silver investors since 1973

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Short and Sweet

Gold coins, hoofs found in 2,000 year old Chinese tomb

Image of Confucius, old, black and white“Chinese archaeologists. . . discovered 75 gold coins and hoof-shaped ingots in an aristocrat’s tomb that dates back to the Western Han Dynasty (206 BC – 24 AD). The gold objects — 25 gold hoofs and 50 very large gold coins — are the largest single batch of gold items ever found in a Han Dynasty tomb. They were unearthed from the tomb of the first ‘Haihunhou’ (Marquis of Haihun) in east China’s Jiangxi Province. The coins weigh about 250 grams each, while the hoofs’ weights vary from 40 to 250 grams, said Yang Jun, who leads the excavation team.” – Xinhuanet/11-17-2015

These gold artifacts were found along with a portrait of Confucius, perhaps the oldest known. Wisdom and gold make easy company. Confucius once said something that has current applicability:  “In a country well governed, poverty is something to be ashamed of. In a country badly governed, wealth is something to be ashamed of.”  Or at the very least, well-hedged ………


Is the wisdom of a hedge in your financial future?
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ORDER DESK: 1-800-869-5115 x100/orderdesk@usagold.com

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Graphic to link the calendar of reports and events for the week ahead

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Row of books on library shelfA Gold Classics Library Selection


Uses and Abuses of Gresham’s Law in the History of Money
by Robert Mundell, Nobel Prize for Economics, 1999

Now deceased, Dr. Robert Mundell, the highly influential Columbia University economist, was well-known for his advocacy of a gold component in monetary systems, including circulating gold coinage. But he also has written voluminously on a wide range of other topics. As early as 1961, Mundell proposed reducing tax rates and improving monetary discipline as the best means to achieve greater and more stable economic growth. His theories on this subject led to the Kennedy tax cuts, which propelled the U.S. economy of the 1960s and later became the supply-side basis for much of Reaganomics. Mundell also wrote early on of the constant realignment problems which would attend a world monetary system of free-floating currencies. His prescient work on the desirability of regional currencies was, in fact, fundamental to the creation of the euro. When Mundell was awarded the 1999 Nobel Prize for economics, Princeton University economist Peter Kenen said, “Bob was modeling the world of the 1990s through the work he did in the 1960s.” Our thanks go to Dr. Mundell for his kind permission to reprint Uses and Abuses of Gresham’s Law in the History of Money in its entirety.

[LINK]

photograph of Nobel laureate Robert MundellDr. Robert Mundell (1932-2021)

[Gold Classics Library Index]

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Favorite web pages

Gold Trends and Indicators
Live charts that make it easy to monitor gold market history and correlations

Map of world colored gold - www.usagold.com Member World Wide Web since 1997

Our Gold Trends and Indicators page was first constructed many years ago to serve a specific need. At the time, there was no single place a client, or prospective client, could go to monitor statistical categories and correlations relevant to gold ownership. This page filled that need with interactive, automatically updating charts that featured gold’s annual returns; one-year, ten-year, and long-term price charts; correlations like gold and the purchasing power of the dollar, gold and the S&P 500 and gold and the volatility index (to name a few); and, real rates of return over the long term on gold and the dollar. It remains a favorite reference among serious investors and students of the gold market to this day. We believe it to be particularly useful to the prospective gold buyer who wants to understand the history of gold under various circumstances as part of the due diligence process.

Gold Trends and Indicators is another of the quiet pages at USAGOLD that garners significant global interest particularly when the market is moving or breaking news warrants more than average interest. We also invite you to return here regularly – to this Live Daily Newsletter page – for up-to-the-minute gold market news, opinion, and analysis as it happens.

Charts offered in conjunction with the St. Louis Federal Reserve and the ICE Benchmark Administration
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We invite you to also check out our other chart page:
Monetary Trends and Indicators
 

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USAGOLD one of the oldest and most respected names in the gold business

Ready to include a safe haven in your portfolio plan?
DISCOVER THE USAGOLD DIFFERENCE
ORDER DESK: 1-800-869-5115 x100/orderdesk@usagold.com

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Short and Sweet

Blowing up the “Everything Bubble”

graphic image of a harried investor watching the blow-up of the financial bubble

“What the average person fails to understand,” writes Lance Roberts in an analysis posted at the Real Investment Advice website, “is that the next ‘financial crisis’ will not just be a stock market crash, a housing bust, or a collapse in bond prices.  It could be the simultaneous implosion of all three. Whatever causes that change in sentiment is unknown to me or anyone else.  I am not saying with certainty it will happen, as I hope sanity prevails and actions are taken to mitigate the consequences. Unfortunately, history suggests such is unlikely to be the case.”

And, we might add, it is not likely the damage will be restricted to the United States. All the largest and most advanced economies are engaged in rate suppression and quantitative easing schemes. In fact, an implosion in one location could cause corresponding meltdowns in multiple locations. Easy money and heavy leverage have greatly influenced price levels in all markets heightening rollover risks. And then there’s the derivative problem with notional exposure estimated at more than $1 quadrillion, according to Investopedia.


Are you ready for the ultimate derivatives moment?
DISCOVER THE USAGOLD DIFFERENCE

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Reliably serving physical gold and silver investors since 1973

 

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Favorite web pages

Why financial advisers should line their portfolios with gold

photo image of gold bars with colorful chart in background
More and more, it is becoming a mainstay in the financial business that the wise investor and/or financial advisor embrace gold as a means to capital preservation in a rapidly changing and increasingly dangerous investment climate. In Cazenove Capital’s case, it is emphasizing gold as a hedge against geopolitical turbulence. “Speaking at a Schroders breakfast briefing yesterday (January 22),” reports Financial Times, “Janet Mui, global economist at Cazenove Capital, said she thought investing in gold was the best way for advisers and fund managers to hedge the risks in their portfolios. She said: ‘Gold has the feature of portfolio hedging and diversification. Gold should be in your portfolio.’”

Related, please see:
Precious metals for financial planners and advisors
We will work with you to offer your clients a strong, service-based
presence in the gold coin and bullion market

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USAGOLD
Quality service & portfolio guidance since 1973

photograph of selection of historic gold coins 2020

USAGOLD ranks among the most reputable gold companies in the United States. Founded in the 1970s and still family-owned, it is one of the oldest and most respected names in the gold industry. The firm’s unblemished, zero-complaints record and solid reviews with the Better Business Bureau testify to the exceptional customer service and professional excellence which sets it apart from the competition.

USAGOLD specializes in gold and silver coins and bullion delivered to our client’s safekeeping. For over 48 years, we have resolutely advocated owning precious metals for asset preservation purposes rather than speculation. Admittedly, this philosophy does not resonate with all prospective gold and silver owners, but if it does with you, we think you will find our firm a kindred spirit.


Interested in gold but struggling to find the right firm?
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ORDER DESK:1-800-869-5115 x100/orderdesk@usagold.com
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Short & Sweet
Past gold bull markets have begun with a surge in the money supply

If the Fed is looking for inflation, it will find it in the money supply – something that did not happen with authority in the aftermath of the 2008 credit crisis. From June 2019, the money supply has grown by $4.5 trillion – an eight times factor year over year. Recently, the rapid growth resumed its uptrend after about six months of moving sideways. During the financial crisis that began in 2008, the Fed sterilized its money creation by routing liquidity back to its coffers in the form of commercial bank excess reserves – a strategy that kept the inflation rate from running out of control. As you can see, the money supply growth this time around goes beyond anything that occurred during the prior crisis. Whether or not it will translate to price inflation down the road remains to be seen – though we have begun to see some signs of inflation taking root, most notably in the surge in commodity prices.

“Every gold bull market over the last 50 years has begun with a catalyst that propelled significant growth in the money supply,” writes Manning & Napier, the money management firm, in a report posted at Seeking Alpha titled The Value of Gold in a Portfolio. “Each of those prior bull markets was proceeded by substantial US dollar money supply growth, making monetary expansion a key indicator. It is important to note that this alone does not guarantee a gold bull market, as there are many other variables at play. … We see the status of each of these economic factors, money supply growth, inflation, and real interest rates, as supportive of higher gold prices ahead. Policymakers have been remarkably forceful in responding to Covid-19, resulting in substantial recent money supply growth in the US, and they appear willing to continue to throw money at the crisis in the year ahead.”

overlay line chart showing gold and M1 money supply drawn in log scale 1970 to present
Sources: St. Louis Federal Reserve, ICE Benchmark Administration • • • Click to enlarge

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Are you worried about the future value of your savings?
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Short and Sweet

Worry about the return ‘of’ your money, not just the return ‘on’ it

photograph of a bag of gold coins
There is an old saying among veteran investors to worry not just about the return on your money, but the return of your money. In the wealth game, emphasize defense when you need to, offense when it makes sense. At all times, remain diversified. And by that, we mean real diversification in the form of physical gold and silver coins and/or bullion outside the current fiat money system – not just an assortment of stocks and bonds denominated in the domestic currency. Keep in mind – if the currency erodes in value, the underlying value of those assets erodes along with it. A proper, genuine diversification addresses that problem now and in the future.


Are you ready to deploy genuine diversification in your portfolio?
DISCOVER THE USAGOLD DIFFERENCE
ORDER DESK: 1-800-869-5115 x100/orderdesk@usagold.com

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A telephone call from an old client and friend
‘Gold shone with the placid certainty of received tradition’


photo of a 1907 St. Gaudens High Relief gold coin

“I had the happy occasion recently of receiving a telephone call from an old client and friend – a physician safely retired near the sea and alongside one of the South’s oldest golf clubs. It was good to hear from this student of the markets – one of life’s steady and thoughtful practitioners. Back at the turn of the century, Doc foresaw much of what would happen economically in the United States and purchased what he considered enough gold to see him through it.”

[For the rest of Doc’s story we invite you to visit this link.]


Interested in gold but struggling to find the right firm?
DISCOVER THE USAGOLD DIFFERENCE

ORDER DESK: 1-800-869-5115 x100/orderdesk@usagold.com
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Short and Sweet

What does bitcoin have in common with the ancient stone money of Yap?

“That does not render bitcoin invalid or the blockchain useless,” writes Gillian Tett in a recent Financial Times editorial. “After all, the mainstream currencies on which our lives depend rely on sometimes tenuous social norms as well. One way to frame the contest between bitcoin and fiat currency is thus as a battle of norms — and of distributed versus hierarchical trust.” Tett, perhaps inadvertently, makes a point a good many gold enthusiasts will embrace. Bitcoin is more readily comparable to fiat currencies than gold – as its value rests completely in the faith that it will not be printed without restriction.

Therein lies bitcoin’s ultimate weakness as a store of value. Who’s to say that any number of copycat cryptocurrencies won’t invade the space and undermine bitcoin’s value? (In fact, a good many already have with varying degrees of success.) Who’s to say that some enterprising software geek doesn’t find a way into the blockchain and begins producing bitcoin willy-nilly? (Which is what happened, by the way, to yap stone money. [More]) Tett ends her essay with some advice for Elon Musk – a new and ardent supporter of bitcoin: “Perhaps Musk’s next trip should be to Micronesia, where those now-useless stone circles still litter the landscape as a sign of what happens when norms and patterns of trust change.” To get to the heart of what Tett – an anthropologist as well as a first-rate journalist – means by that statement, you will need to read her essay in its entirety at the link above. In Musk’s defense, he also expressed an interest in Tesla building its gold reserves.


Are you worried about your savings going the way of the stone money of Yap?
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ORDER DESK: 1-800-869-5115 x100/orderdesk@usagold.com

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