Richard, my perception is that the thinking among some of the Indians is changing. By far, most bought gold for jewelry only. On the surface, there is very little "investment" interest in India. However, I remember my mother and grandmother telling that gold is always a good "investment" (they mean jewelry). Most vysyas (often called in the North as Set, pronounced Sate) who are traditionally the business class (caste) in the country regularly buy gold for jewelry. This is true a generation ago. Just in the past 4 years, a vysya friend of mine (our generation) has had a change of heart on gold. He thinks it is a complete waste to put money in jewelry and gold. He says that is how the thinking is among the members of his community. Coincidentally, there are articles about gold being a "wasted investment" in the local media. (FYI - #reply-10999418)
I can see the influence of the fiat money on these people. After all, my vysya friend has made a lot of money in building and selling apartments - which are often bought on credit. Purchase on credit in India are now termed "bought on installments" just as they were called here in the early 1900s.
BTW, the opportunist I am, in India I see an exponential growth in this "installment" purchase of houses/flats in the next decade. That's why I bought shares in an Indian company - LIC Housing and finance.
All this makes me very bullish, in contrarian terms, on gold. |
