Latin currencies

[Ceviche]

Haha

I didn't say don't buy it. Do what you want. Just that it's a crap investment. I don't think it's a bad idea to have a small percentage as a hedge.

Gold is "not" a investment. Its a store of value. Its just that we all keep talking about depreciating Argentine pesos cos we live in Argentina and Argentine people have no better option than to store that their money in USD..but truth is that USD is itself a depreciating currency and it is just managing to hold on cos its the reserve currency of the planet..till when who knows..but it won't be forever..Thats where Gold comes..it a store of value and has been for centuries and will remain so. Its like an insurance policy.

I invite you to read the book. - Currency Wars by James Rickards. Will send a chill up the spine.

 

[Weyland]

Gold is "not" a investment. Its a store of value.

I agree Ceviche. As an investment it's crap. As a hedge or insurance policy it's good.

USD loses 4-5% value every year. Cash is trash.

I checked out Currency Wars. Looks interesting, I'll give it a read. Thanks for the recommendation!

 

[Caribbean Cool]

A guy bought an ounce of gold awhile back...when it was $1700/ oz.....and bought it with Ar pesos valued at 10 to the US dollar. So he paid 17000 pesos for his gold. And yes....the price of gold has gone down. And it did go down to around $1200 oz...and let's say that is where it is now(yes I know it is higher) At 1200$ his 17,000 pesos is worth 48000 pesos using 40/dollar. HIs friend had the same amount of money to 'invest' at that very same time but he didn't buy the gold....he bought a house. Small tiny house for 17,000 pesos. And maybe all of this took place 2-3 years ago ??? If he had sold that house when gold was down to 1200$ he would have had to have gotten 48000 pesos for his little house to equal the gold transaction. Had the price of a house in Argentina appreciated 300% in those few years? Had a house that cost 100,000 US gone up to 300,000 US ???? And let's remember something....though approximate I believe the numbers are representative and...all this took place as gold was coming down!!!!!!

It's late...and my math suffers late at night and maybe I figured it wrong. So...investment or store of value. In Argentina the lines are murky.

 

[pennsylvania]

A guy bought an ounce of gold awhile back...when it was $1700/ oz.....and bought it with Ar pesos valued at 10 to the US dollar. So he paid 17000 pesos for his gold. And yes....the price of gold has gone down. And it did go down to around $1200 oz...and let's say that is where it is now(yes I know it is higher) At 1200$ his 17,000 pesos is worth 48000 pesos using 40/dollar. HIs friend had the same amount of money to 'invest' at that very same time but he didn't buy the gold....he bought a house. Small tiny house for 17,000 pesos. And maybe all of this took place 2-3 years ago ??? If he had sold that house when gold was down to 1200$ he would have had to have gotten 48000 pesos for his little house to equal the gold transaction. Had the price of a house in Argentina appreciated 300% in those few years? Had a house that cost 100,000 US gone up to 300,000 US ???? And let's remember something....though approximate I believe the numbers are representative and...all this took place as gold was coming down!!!!!!

It's late...and my math suffers late at night and maybe I figured it wrong. So...investment or store of value. In Argentina the lines are murky.

You're comparing the change in USD and ARS at the same time, that's why you're confused.

Person A and Person B both started with 17,000 ARS and exchanged it for 1,700 USD. Person A bought 1 ounce of gold with it, Person B purchased a house. 3 years later Person A's ounce of gold is now worth 1,200 USD and Person B's house is still worth around 1,700 USD (we didn't discuss how much property value changed in regards to a stable currency like the USD, so I'm going to assume 0% for the example).

If they were to sell their assets for USD now and convert to ARS at 40 ARS / 1 USD, Person A would have 48,000 ARS and Person B would have 68,000 ARS. Both are much better off than if they had held ARS in the first place, but Person B's real estate was a much better pick. Person A's gold was actually a really bad store of value in this period because it lost a lot of value even compared to a stable currency, so Person A has less purchasing power now than they had 3 years ago and Person B has the same amount.