I don't think any government is going to intervene in any way RE: gold.
If any currencies of importance were tied to gold they might.
Intervention, if it comes, is likely (I think) to take the form of interest rate changes.
I think we are entering upon the great test of whether world-wide fiat currencies can be controlled. For the time being, I am betting by far most heavily against the continuation of the over-valued doillar. If General Motors doesn't want it--well, probably no one but me remembers the Al Capp parody in the 1950s with the character General Bullmoose. "What's good for General Bullmoose is good for the country."
But I WILL say that I think no one is going to go broke owning gold.
Just in case there's a real panic uptick in gold, I own calls on XAU. I was much scorned by "SliderontheBlack" who said the HUI index was much better. Then I find out that it's impossible to buy options on that index, and since options provide enormous leverage upwards, I think I did the right thing. They move 100% up for every 20% up move in mining stocks, at least. I say "Pfui on HUI!" I am not about to go building my own margined portfolio of the gold stocks in that index.
I also own ASA, CEF, and PDG, for a medium-term increase in gold.
And I have total disaster insurance of gold bullion in several forms.
But all this is only about 5% of my net worth. I think it's enough for insurance.
I have about 10% in BEGBX, the euro fund. I have about 5% in euro warrants and about 5-10% in FAX, the Pacific (mainly Aussie) bond fund.
All this gives me a dollar-protection portfolio of about 25% of my net worth, unless you count oil stocks. And included in "net worth" is mortgage-free real estate.
I guess I am laying this all out because I have found myself accused of lying and restating my positions ex post facto. So win or lose, this is in large part where I am right now--betting heavily against my own country's currency but only in small part by using gold. |
