By John Meyer, financial consultant. Eurasia Business News, January 22, 2022
I like books that break codes and force me to question my certainties. Swann Collins’s book on gold is provocative. He argues in favour of gold whereas financiers usually support investments in stock markets, treasury bonds and life insurance policies to build and maintain your investment portfolio. But with the return of high inflation in Europe (5-6% in 2021) and in the United States (7% in 2021), the purchasing power of paper money is each month further eroded. The liberal economist Milton Friedman said that “Inflation is taxation without legislation.” Gold is traditionnaly seen as a great hedge against inflation. Demand for gold is multiple : as an investment, as an reserve asset, for jewellery of for technology. Inflation was a key factor for investors in 2021 and will remain in the landscape in 2022. Persistent supply chain disruptions, Covid-19 and geopolitical tensions will keep testing national economies and paper currencies. Amid many uncertainties, the value of gold will last. Investing in gold can be considered as a wise move, to protect your wealth.
In 208 pages, the author, who is also an investor and consultant in international business, methodically presents all the strength of gold as an investment medium and protection of your purchasing power. The first chapter is devoted to the 2500 years history of monetary gold and the critical changes that occurred in the 20th century, from World War I to Bretton Woods Conference in 1944, the Genoa Conference in 1922 and the August 15, 1971, all events which led to the current monetary, financial and economic imbalances. The author explains why the gold standard can return to Europe and the United States. For instance, the South Carolina passed a bill in April 2013 declaring gold and silver legal tender. The same year, both Texas and Louisiana enacted laws to completely eliminate the state sales tax on gold bullion. In Oklahoma, Governor Mary Fallin signed into law a Senate Bill in June 2014, recognizing gold and silver U.S.-minted coins as legal tender and exempt from state taxation. Including Arkansas, 40 U.S. states now fully or partially exempt gold and silver from the sales taxes. Also, did you know that some states have already reinstated gold as a legal currency ? The gold coin “Khalifa” is a legal currency in Dubai since 2011.
In the second chapter, Swann Collins develops the seven reasons why every free man should invest some of his wealth in gold.
The fourth Chapter is dedicated to the important issue of when selling gold ?
Lastly, the fifth Chapter deals with an important issue for each investor : taxation. Gold is subject to several taxes. Each tax impacts the yellow metal at various different stages of the exploration and production cycle, in its import and export and in its purchase and sale. Royalties and production taxes on gold vary from country to country. The tax regime in force in your country can reduce your gains. The author gives valuable insights about taxation of gold in ten countries : the United States, France, the United Kingdom, Canada, Italy, Ireland, Spain, Germany, Switzerland and Australia.
In his book Swann Collins explains with talent that quantitative easing policies by central banks during decades in Europe, in the United States and in Japan have been reducing the value of paper currencies. Printing billions out of thin air generates inflation of consumer prices and causes assets prices bubbles. People who want to buy an apartment or a house in the U.S. or in Europe will understand it. Several graphs and official data inside the book show the sources of housing and rent prices bubble and strengthen the case for gold. Large state spending further lowers the purchasing power of paper money. The resulting inflation reduces your purchasing power. The inherent strength of gold as a rare and demanded store of value remains unchanged.
The former Chairman of the U.S. Federal Reserve Alan Greenspan, said in an October 2014 interview at the Council of Foreign Relations :
“Gold is a currency. It is still, by all evidence, a premier currency, where no fiat currency, including the dollar, can match it.”
The well-known financial manager Mark Mobius said in August 2021 that every investor should have 10% physical gold in their investment portfolio to hedge against the risk of inflation and currency devaluation.
As a conclusion, “Gold, Build Your Wealth and Freedom” is a great book for private investors and free people, wanting to understand the monetary policies of central banks, willing to secure their purchasing power, make gains and reduce the negative consequences of inflation on their portfolio. Buying this book will be a great investment for 2022.
About the author : Swann Collins is an investor, writer and consultant in international affairs. He has published over 100 articles specializing in economy, finance and investments.
To contact the author, write at : email@example.com
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