Warren Buffett and Ray Dalio two very different views on gold

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GON

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In the last 20 years, the S&P 500, assuming you invested all its dividends, increased 697.8 % so not quite as high as gold, but fully 1/2 of gold’s rise in the last 20 years was just in the last few years.
 
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GON said:
Two billionaires that made their money by being right on investments , have very different views on gold.

Buffett states gold is a non performing asset. Dalio is recommending being overweight in gold.

Interesting when two very successful investment billionaires assess gold so differently.

https://finance.yahoo.com/news/billionaires-warren-buffett-ray-dalio-090700008.html
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How much gold roughly are you holding, PM or in funds? Or if you like what % of your savings is gold?

The rest is just chatter. People throw the Buffet da God name out so much. He was never the perfect "investor". His mistakes get hidden. And this is not taking anything away from the money he has made. But his whole schtick about taxes and such is particularly silly.

Anyway, Dalio is just as human, a bit less known to the GQP. I actually don't know what he was saying about gold when I was buying. 10-5 years back. That might be telling.

Oh and I did NOT click on your Yahoo link. I do NOT visit that site of lies and misinformation. It belongs in the weedless barren dirt and rocks, wasteland.
 
Gold is just like anything else. A piece of the overall asset mix puzzle. If you are using it in the portfolio it adds some inflation resistance, but should be rebalanced in accordance with your decided asset mix. That allows you to realize gains and buy on dips without using emotion.
 
Pablo said:
How much gold roughly are you holding, PM or in funds? Or if you like what % of your savings is gold?

The rest is just chatter. People throw the Buffet da God name out so much. He was never the perfect "investor". His mistakes get hidden. And this is not taking anything away from the money he has made. But his whole schtick about taxes and such is particularly silly.

Anyway, Dalio is just as human, a bit less known to the GQP. I actually don't know what he was saying about gold when I was buying. 10-5 years back. That might be telling.

Oh and I did NOT click on your Yahoo link. I do NOT visit that site of lies and misinformation. It belongs in the weedless barren dirt and rocks, wasteland.
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Buffett: whale can only move so fast and therefore must move in a predictable way, and win using its size (as the counter party to others in distress).

Dalio: historian who build wealth with an all weather mentality (check his strategy of all weather portfolio).

Peter Lynch: do what you do best and has an advantage over others. It works well in small scale but can't scale up to whale size.

Jim Simon: everything is in the data, speed is everything (he is a trader not a long term investor).


There are many different way of investing, the only common theme among all the successful investors I know is: don't lose your money.

Basically, don't over-leverage to a point that someone can margin call your account and you lose everything before your rebound. Eventually even if you lose money short term, asset prices would go back to where the market is.

I believe in gold at the current (say 3 years) worldwide debt level, interest rate, and inflation number, but I am also a believer that in the long term gold is not something that would outperform growth in assets (say 30 years). Ray Dalio and Warren Buffett are both correct depends on how you look at them. I also think Peter Lynch is right all along too.

Not a fan of some of the guys like Sam Altman or Elon Musk in investing, not that they are wrong just I would never agree to their degree of leverage using other people's money.
 
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Snagglefoot said:
So the trick is to sell everything and buy gold at the present $4,000 per oz. LOL.
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You can say the same about every assets today. Everything is overpriced already.

Gold at 4k / oz
PLTR at 150 PE
OpenAI is practically leveraged to what? 100x its book value?
Residential RE is what? 7-10 years of income level in good area?
McDonalds cost like $15 a good meal? Dollar menu at $4 now?
Crypto I don't follow but I am sure it is 4x from 7 years ago at least.
Heck even a used gaming GPU is selling for the new price of 4 years ago without depreciation.

All other stocks than the Mag 7 are doing not too well, all other nations except Taiwan and US are not doing too well.

The only cheap thing today is Yen. I feel bad for the Japanese salarymen.
 
Vil_Riker said:
The US has a history of confiscating gold so it's not a safe place to park your money.
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That's why you invest in a fund that diversify its holding all over the world. If that day when every central bank confiscate gold comes I don't know what else to do. It is probably time for canned food and water bottles. You can only wear so many Rolex and if you are already in the US where else would you trade your Rolex for a lifeboat ticket to?
 
I'm of the opinion that gold doesn't increase in value, mostly just keeps up with inflation and it is exactly like a crypto currency relative to what you can buy with it directly...without turning it back into dollars.

My FIL has SEVERAL 20 dollar gold pieces because his GF got paid with them, also the 10 & 5s. I think those 20 dollar pieces are close to an ounce...so for perspective, in 1920 gold was 20 dollars and ounce and that wasn't that long ago, my house is 35 years older than that.
 
Snagglefoot said:
In the last 20 years, the S&P 500, assuming you invested all its dividends, increased 697.8 % so not quite as high as gold, but fully 1/2 of gold’s rise in the last 20 years was just in the last few years.
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Right, and the price of gold in proportion to M2 money supply?

1762284434567.webp


The price of gold in dollars is also the price of dollars in gold. Based only on nominal gold price, it's all but impossible to tell if Gold has gone up, dollars have gone down, and what the proportion of each is relative to the other.

As you can see from the chart above, the price of gold as a function of money supply has mostly moved sideways. And depending on which points you want to cherry pick for comparison, you can show a massive gain for gold, a massive collapse, and anything in between.

Buffet has the better argument. Gold produces nothing. There's no difference between hoarding gold and hoarding oil or pork bellies or any other fungible commodity. It's just that gold has history and portability, things that oil and pork bellies don't have.

Tobacco leaves were once the primary means of exchange and store of value within the USA. Heck, even airline miles are a form of currency.
 
Imho, USD will lose another 90% of its value before 2030, that's if USD isn't replaced by some sort of digital currency before then.
So, if gold is about US$4k now it'll be about $40k in 2030, that's only 4 years from now.
 
Vil_Riker said:
the fed simply devalues it.
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That's my point. Whether it's inflation, interest rates, or removing the gold standard, we're at the whims of their manipulations. I don't see how it's any different from confiscation if what you're left with is worthless.
 
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