Will the Government Take Your Gold?

All your gold questions answered… [Morning Reckoning] April 18, 2023 [WEBSITE]( | [UNSUBSCRIBE]( Will the Government Take Your Gold? - Gold has room to run, even if some readers think I’m wrong… - Answering all your gold questions including if Uncle Sam plans to take your stockpile… - The gold bandwagon is filling up… [Oil Surge Predicted... Are You Prepared?]( JPMorgan commodities analyst Natasha Kaneva agrees with me – she predicts the U.S. retail price has the potential to surge to a $6.20/gallon national average. If gas hits $6 per gallon, there are a lot of U.S. households who will struggle to afford the gas they need to commute to their jobs. It’s coming… And we’re just days away.. [I just revealed my #1 way to profit from oil in 2023.]( And after the recent OPEC cut announcement – there is no time to waste. [Click here to get all the details and watch my urgent video now.]( [LEARN MORE]( Baltimore, Maryland April 18, 2023 [Greg Guenthner] GREG GUENTHNER Good Morning Reader, Writing about gold sometimes lands me in hot water. Readers have sent me more than my fair share of nastygrams over the past decade as gold chopped through a secular bear market. If I marked up a chart that led me to believe the yellow metal was close to another breakdown, my inbox would overflow with letters from angry gold bugs. Most dissenters were cordial enough. But a few would employ, well, let’s just say unique and colorful methods to express their distaste for my market opinions. Those emails always made me smile. It’s nice to know your work is appreciated! But lately, I’ve been receiving way too much praise for my analysis. That’s probably because gold has been breaking out, once again topping $2,000 as it pushes toward all-time highs. And I believe it has a lot more room to run… Long suffering gold investors are understandably excited about gold’s resurgence and the potential for much higher prices in the weeks and months ahead. But I get nervous when everyone begins to agree with my ideas. The contrarian in me starts to wonder – am I walking into a trap? Thankfully, I’m not yet seeing any signs pointing to toppy action in precious metals. The financial media isn’t even buzzing about gold’s most recent march above the mythical $2K level. Instead, we’re watching the move play out without a ton of mainstream buy-in. I’m surprised they’re ignoring precious metals right. But I’m also relieved that gold isn’t gracing the cover of Barron’s this week. We don’t need that type of jinx just as the metal and miners are starting to see some real traction. In an attempt to ward off any evil bear market spirits, I’m going to dig deep into the mailbag today and attempt to answer some of your most pressing gold questions. While I’ve received many nice notes lately, I also have a stack of inquiries to sort through. Instead of printing out every note in full, I’ve grouped together the most-asked questions and will attempt to answer them to the best of my limited ability. I think we’ll all benefit from the discussion. Let’s dive in… [Man Who Predicted Bitcoin Warns: “Don’t Buy Bitcoin!”]( [Click here to learn more]( James Altucher first predicted Bitcoin all the way back in 2013… And ever since, he’s been one of the biggest advocates for it. But now, he’s warning Americans that buying Bitcoin could be a big mistake… [Click here now to see why](. [LEARN MORE]( Do you anticipate that the government will confiscate gold and silver? This question keeps popping up, so I’m going to leave my wheelhouse and try my best to answer it. I’m just a guy who draws lines on charts, but I can tell you I don’t anticipate any organized attempt to confiscate gold or silver in the near future. Does this mean it can’t or won’t happen? Absolutely not. I don’t think it’s farfetched to assume that if the government wants something badly enough, it will attempt to take it by any means necessary. If a serious, prolonged crisis were to emerge, it’s possible that depression-era tactics such as confiscation would bubble up. Fortunately, it’s easy enough to stay under the radar. The Feds are not tracking physical gold purchases of any kind. Unless you’re slinging ridiculous amounts of reportable cash purchases of gold coins or bullion, I don’t think Uncle Sam is paying you any mind at all. Ultimately, I don’t believe buying rare or foreign coins would avoid any doomsday confiscation scenario. In a world of increasing government overreach, it would be foolish to assume any tactic is off the table – especially in a crisis. Perhaps the best move is to stack your gold and stay quiet. Loose lips sink (golden) ships! Should I invest in physical gold or paper gold? Does it matter? Whether we’re talking about gold, tech stocks, or crypto, you should always approach your trades with the same simple question: What’s my goal with this investment? Are you looking to hold for months, years, or decades? Is this a speculative or core portfolio position? What is your stop loss – or the price/event that will trigger a get out or take profits? We can trade shorter-term moves in gold via the futures market, mining stocks, or through gold funds. We could also buy-and-hold gold using various funds such as the popular SPDR Gold Shares (GLD). Of course, these are all ways to gain exposure to gold’s price moves. But gold is a different animal than most equity investments. If you’re looking to hold gold as a form of disaster insurance, you’re probably looking to stash away physical gold. It makes no sense to increase exposure to mining stocks or gold ETFs if your ultimate goal is wealth protection against some sort of doomsday event or unprecedented financial disaster. You don’t have to be “all-in” on one investment or trading goal, either. There’s nothing wrong with a physical gold owner who also trades mining stocks when the timing’s right. Just know what’s what in your portfolio. How do I convince my (brother/coworker/crazy ex-girlfriend) to invest in gold? Like many things in life, fights over investments are usually simple misunderstandings between two people with different goals. But when we lay our money down on an idea, the situation becomes personal. How could you not see what I’m seeing? Why are you betting against me? Of course, investing is never actually this black and white. We have our strategies, just as everyone else has theirs. If we like a company or investing theme and want to buy shares for the long haul, we shouldn’t get too upset when a swing trader sells the stock short to make a quick buck. It’s not personal. But no one bothers to ask these questions. Instead, we treat investing like a team sport. You’re either with me – or against me. Gold’s performance following its 2011 flame out has scared many investors away over the past decade-plus. That said, I do think more “mainstream” market watchers will start climbing aboard the gold bandwagon over the next several weeks if the yellow metal can maintain this breakout above $2K. If you’ve had trouble persuading friends or fellow investors that gold is worth a second look, improving market conditions are suddenly making your arguments a lot more convincing. As precious metals continue to break out, even the most skeptical traders will start slinging junior miner stocks with the rest of us… If you have any questions, suggestions or feedback on this topic, please let me know [here](mailto:feedback@dailyreckoning.com). Best, [Greg Guenthner] Greg Guenthner Contributing Editor, Morning Reckoning feedback@dailyreckoning.com [Download My New Survival Guide Today!]( I’ve created a BRAND-NEW “2023 Crisis Survival Guide” that I’m making available to all of my Strategic Intelligence readers today. This short 54-page document has everything you need to know to protect yourself and your family in times of crisis. Things like what foods to stock up on now, staying safe during periods of rioting and looting and more. Inside I break down all of the coming threats you face and how to prepare. [>> To see how to download your copy, click here now](. [LEARN MORE]( In Case You Missed It… We’re Screwed If We Don’t Do the Math Sean Ring, Editor [Sean Ring] SEAN RING Good Morning Reader, Happy Thursday from Northern Italy! Most economists agree that there’s an inverse relationship between women’s literacy and birth rates. Economists concluded that the more women read (and are educated), the less they want children. I’ve always thought that conclusion didn’t match reality. I believe that the more women can do the math, the less children they want (for lifestyle reasons). That is, numeracy, rather than literacy, drives the decision-making. There are loads of examples of career women who can afford – and have – more children. Sara Blakely, Victoria Beckham and Amy Coney Barrett come to mind. But this column isn’t about demographics. It’s about innumeracy, which we’ll define as incompetence with numbers. It’s what I think society’s big problem is. But instead of whining about the causes, symptoms, and cures of innumeracy, I’m going to give you a few rules of thumb. You can use them to see if your decision-making changes. For my part, these simple equations and rules gave me a target. Specifically, I knew how far ahead or behind I was, and how far I had to go to reach my goal. I won’t bombard you today, as I think the fewer and the simpler, the better. So let’s start with five simple rules to see if they change how you think. [Urgent Notice From Paradigm CIO Zach Scheidt!]( [Click here to learn more]( Hi, Zach Scheidt here… I’m the Chief Income Officer at Paradigm Press. With inflation raging (and showing no signs of coming to an end any time soon), almost everyone in America is feeling the pain in a big way. Which is why, several months ago, I set out on a big mission… my goal was to create a [complete, step-by-step plan to surviving and beating inflation]( one that anyone could take advantage of. Today, after hundreds of hours of research, I’m revealing all of my findings. [Simply click here now to see how to survive America’s deadly inflation crisis](. [LEARN MORE]( The Rule of 72 The Rule of 72 is one you’ve probably heard of. And you might be wondering why I’d even include such a rule. Well, let me first state the rule and then we’ll talk about how to use it. For most people, the Rule of 72 tells them how long it will take to double their money if it’s invested at a constant rate of return. For example, if you’re earning 10% per year on your portfolio, it’ll take 72/10, or 7.2 years to double your portfolio. If you wanted to back out the math, let’s assume you had a $100,000 portfolio. $100,000.00 x (1 + 0.10) ^ 7.2 = $198,622 The Rule of 72 isn’t perfect. But near enough is good enough in this case. If you’ve got a superstar financial advisor earning you 20% per year, then it’ll only take 3.6 years to double your portfolio. Now, let’s use this rule to look at inflation… something Sleepy Joe doesn’t want you to do. Historically, central banks have tried to keep interest rates around 2%. That meant a currency lost half its purchasing power in 72/2 or 36 years. You’d barely notice the loss in purchasing power, as it’d take so long to rear its ugly head. You’d probably go to the grocery store and wonder why eggs are “suddenly” double what they used to cost in 1983. We’ve all done something like that, haven’t we? But with inflation hitting 10% as it recently has, a currency loses half its value in only 72/10 or 7.2 years. Realistically speaking, let’s say Chairman Pow comes out and says, “We’d love rates to go back down to 2%, but that’s just not realistic. We’re now happy with a 4% target.” In that case, the dollar would lose half its purchasing power in 72/4 or 18 years. If you think eggs are expensive now, just you wait until 2041! The Rule of 72 is not only a great way to look at returns, but also at purchasing power erosion. Net Worth Indicator This is a great targeting mechanism, and one I’ve regrettably only just found. It’s from The Millionaire Next Door, by Thomas J. Stanley and William D. Danko. Multiply your age times your realized pretax annual household income from all sources except inheritances. Divide by ten. This, less any inherited wealth, is what your net worth should be. If you hit this number, you’re an AAW, or average accumulator of wealth. According to the authors, to be considered a PAW, or prodigious accumulator of wealth, you “should” have at least twice this number. What I like about this indicator is that it’s simple to calculate. And it gives you a target. Full disclosure, I’m a UAW, which is an under-accumulator of wealth. But I won’t use this number to feel bad. What I choose to do is to think bigger and get better results. If you’re unhappy with what this number tells you, I suggest you do the same. The 50-30-20 Rule Tweaked This is a great way to allocate your monthly paycheck. And it’s super-simple: - 50% of your income goes to paying your “needs.” These include rent or mortgage payments, car payments, groceries, insurance, health care, minimum debt payment, and utilities. - 30% of your income goes to paying down your debt. Once that’s done, this becomes discretionary entertainment expenses.* - 20% of your income goes to future investment. *In the original formulation, 30% go to your “wants.” That’s fine, but I think paying down your debt to zero takes priority. I couldn’t believe how fast my debt disappeared. It took about six to twelve months. But it was gone and gone for good. I’ve run a monthly credit card balance maybe once or twice in the last twenty years. And it’s thanks to this little system. 3x Rule for Buying a House Another one I love and that would keep many a rich people out of trouble, let alone those of lesser means. Never spend more than three times your gross annual income on a house. I’m in the process of buying a house right now and I’m well within this rule. My down payment is ready and won’t empty my account, and my monthly payments are easily manageable. Far too many people only calculate what their monthly payments would be at the current rate of their mortgage. But if you’ve got an adjustable-rate mortgage, that could easily end in tears. There’s no need to overpay for a McMansion. [Send Me Your Mailing Address!]( [Click here to learn more]( The biggest gold bull market in history has just begun. That’s why New York Times best-selling author Jim Rickards has arranged to send his must-read book on gold to any U.S. citizen with a valid mailing address today. [Click here now to see how to claim your copy of The New Case For Gold](. [LEARN MORE]( The Normal Distribution (Bell Curve) Finally, we get to simple probabilities. [chart] Again, this is just a rule of thumb. Nothing in finance is “normal.” But this can help you distinguish investing realism from fantasy. Let’s do an example. Let’s say Stock ABC has earned on average 5% per year. But it’s accomplished that with a standard deviation around that 5% average of 2%. If we assume normal returns – a dangerous thing in finance, but we do it all the time – then ABC has a 68% chance of returning between 3% and 7%. It has a 95.6% chance of returning between 1% and 9%. And it has a 99.7% chance of returning between -1% and 11%. Here’s the thing, though: it certainly can crash far below a -1% return. And it may moonshot 45% on the FDA approving its new drug. But the probability of either of those scenarios happening is very low. Knowing this distribution is incredibly important for setting your expectations as an investor, and for also gauging what the market thinks of your potential investment. If you can adjust your thinking to being more probabilistic, you’ll be shocked at how different the world looks. Wrap Up The absolute last thing I wanted to do was to patronize you. But I also don’t want to assume you know things you may not know. So I hope, at the very worst, this was just a refresher of things you may have put on the backburner. But if there is a lot of new material here, I can’t encourage enough to deploy this new knowledge as early and as often as you can. If this is the sort of thing you’d like to see more of, please let me know [here](mailto:feedback@dailyreckoning.com). And if you found this the least bit unhelpful, do let me know that as well. Have a wonderful rest of your week! All the best, [Sean Ring] Sean Ring Contributing Editor, The Morning Reckoning feedback@dailyreckoning.com Thank you for reading The Morning Reckoning! We greatly value your questions and comments. Please send all feedback to [feedback@dailyreckoning.com.](mailto:dr@dailyreckoning.com) [Greg Guenthner] [Greg Guenthner, CMT,]( is chief strategist at Forge Research Group. He has spent the better part of the past two decades developing long-term and short-term strategies with a single goal in mind: to help everyday investors generate outstanding returns and control their financial futures. Greg’s charts, analysis, and insights have appeared in Marketwatch, Forbes, Yahoo Finance, and many other financial publications. [Paradigm]( ☰ ⊗ [ARCHIVE]( [ABOUT]( [Contact Us]( © 2023 Paradigm Press, LLC. 808 Saint Paul Street, Baltimore MD 21202. By submitting your email address, you consent to Paradigm Press, LLC. delivering daily email issues and advertisements. To end your The Daily Reckoning e-mail subscription and associated external offers sent from The Daily Reckoning, feel free to [click here.]( Please note: the mailbox associated with this email address is not monitored, so do not reply to this message. We welcome comments or suggestions at feedback@dailyreckoning.com. This address is for feedback only. For questions about your account or to speak with customer service, [contact us here]( or call (844)-731-0984. 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