If you see some risk in the U.S. economy and want to protect your retirement savings, I suggest you buy physical gold in your IRA.
This can be done easily enough. You first move your retirement account to a U.S. custodian that allows for this type of investment. We then form an offshore LLC and open bank and storage accounts under that entity. The LLC is the owner of your account and assets… with you as the only signatory on those accounts. You can now buy physical gold to hold in a vault in Panama or Switzerland, or coins that you take possession of. You can also open bank accounts in just about any currency and completely diversify out of the U.S.
And now is a great time to buy physical gold. The growing distrust of America has not translated in to higher gold prices. In fact, gold is well off its high of $1,895. Add to this the fact that production is set to decline significantly in 2015 (because the production cost per ounce is skyrocketing) and gold looks like a solid long term investment.
For the first time ever, the majority of Americans are afraid of their own government. According to a Pew Research poll 53% of us think that the U.S. government threatens our personal rights and freedoms.
Though, in my opinion, the price of gold has little to do with the decision to buy. While it’s nice to sell at a profit, the focus is to diversify and create a partial hedge out of a U.S. economic melt down. Gold is the perfect investment to protect your assets. Because it can be bought and sold just about anywhere in the world, and because you can buy it in your retirement account if you set up an IRA LLC, to buy physical gold at any price is a wise move.
For now, gold’s value is determined by a very complex financial trading system. Gold is loaned, leased, hypothecated and re-hypothecated over and over. This inflates the supply – at least on paper – and has a significant downward impact on the market price. For example, 9,000 metric tons are traded daily while only 2,800 metric tons are mined annually.
This artificial system has created havoc in the market. When Germany demanded the return of its 700 tons of gold back in 2011 the U.S. couldn’t deliver. So far, only a small portion has been sent and the U.S. now says it will be some time after 2020 before the full amount can be sent. Of course, Germany can visit its gold in New York, but they can’t take it until all of the hypothecation contracts are up.
The bottom line is that gold contracts and paper gold often leverage physical gold by 40 to 1. All of these shenanigans in the paper gold market (EFTs, LBMA, and Comex) push down the price. If there was no leverage or hypothecated trading, especially as a hedge in FX, prices would be many times higher than they are now.
Again, this is all to say that the price of gold has a lot of potential and is a uniquely interesting investment. Though, I still believe that, to buy physical gold for your retirement account is not about investment return. It’s to protect your retirement from the United States and the weakened financial position we find our nation in.
It is also to say that, holding paper gold for the purpose of protecting yourself from a major devaluation or catastrophic collapse is folly. Fear of the government means you must also fear the economic system in general and that you must hold physical gold.
For these reasons, I suggest you buy physical gold in your retirement account. The price should not be your primary motivating factor, but know that any event that cuts off leverage and hypothecation will send the value of physical gold rocketing upward. In a panic, paper gold has no value. You need the real thing.
I hope you have found this post interesting. For more information on how and where to buy physical gold in your IRA, please send me an email to email@example.com. I look forward to working with you.