State of Idaho Could Become a Serious Gold Buyer
“Is gold money?” asked U.S. Representative Ron Paul. This was half a dozen years ago, before he retired. He was speaking during a hearing with former Federal Reserve Chairman Ben Bernanke. The Chairman appeared to be caught off guard. He thought for a moment and then replied it wasn’t.
I was interviewing an investor and the subject of gold came up and he explained it never changes value
It’s still valuable. A lot of people have gone some extra miles to get their hands on gold. Now a member of the Idaho State House of Representatives would like to allow the State Treasurer to invest in silver and gold. Ron Nate is an economist in his day job. Some believe precious metals are too volatile as an investment but the change would allow the Treasurer to at least have the option.
Nate believes it could be a good hedge against inflation and he also suggests it be stored in Idaho.
Some years ago, I was interviewing an investor and the subject of gold came up and he explained it never changes value. I didn’t understand because I’ve seen the price in paper money terms swing by hundreds of dollars during my long life.
He explained that during the days of the Roman Empire an ounce of gold would buy a sturdy toga. He then shared an ounce of gold in dollar terms would buy a good suit in 1920. Then he told me an ounce of gold would buy a good suit in 2005.
Other investment planners weren’t quite so enthusiastic. They don’t recommend against buying metals. They simply believe it should be part of a much more diverse portfolio.
Nate’s effort may be driven by the volume of federal spending we’re seeing. Historically it can drive inflation and could have an impact on the value of the dollar. You could see a run on metals.
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