Line of Credit (Credit line) for physical gold?

[Causalien]

Wouldn't MRE be better? 30 yea shelf life. Enough to last till retirement.

[dogcom]

I believe the recipe for disaster is to first have no debt. Then have the survival gear, food, weapons, shelter and so on and then some gold and silver.

[smihaila]

I believe the recipe for disaster is to first have no debt. Then have the survival gear, food, weapons, shelter and so on and then some gold and silver.

What do you mean? Can you detail a bit on that? Thanks.

[andrewf]

I thought MREs only had a 3 year shelf life. There aren't too many foods that stand up to storage longer than 3 - 5 years without becoming completely disgusting if not inedible.

[CanadianCapitalist]

Correct me if I'm wrong here.
If you invest in an ETF gold stocks or bullion wouldn't that be treated as an investment?

I'm with Potato on this one. Gold bullion or gold bullion ETFs most likely won't pass the "reasonable expectation of income" test. After all, gold bullion holdings are never going to pay dividends or interest.

Gold stocks or gold stock ETFs will pass the "reasonable expectation of income" test. After all, a stock even if it doesn't pay a dividend now, might pay one at some point in the future.

See this CRA bulletin: http://www.cra-arc.gc.ca/E/pub/tp/it533/it533-e.pdf

[dogcom]

What do you mean? Can you detail a bit on that? Thanks.

During a financial crisis you could lose your job and have trouble making the payments on your debt. Your LOC gets called in or in the case of your broker you get a margin call.

During the 2008 financial crisis gold held up well after the crisis in the later fall of 2008. The reason gold fell like everything else in the early fall of 2008 was because of the great need for cash to pay down debt, margin calls or to meet redemption requirements in mutual funds and so on. So when your back is against the wall you are forced to sell whatever you can, whether you like it or not at whatever price you can get.

Bottom line is your call for gold to go to the moon could be dead on but you may never see those gains because you were forced from your position at a possible big loss because you were desperate for cash to meet debt requirements.

[andrewf]

Holding bullion is not an investment, it is a speculation. You are speculating that the value of gold will rise, and you are not expecting any income to flow from holding gold.

[ddkay]

Moving to a gold standard would immediately put us into a deflationary spiral. Fiat is the only thing keeping us afloat, like it or not. Zero chance any country will move back.

[Causalien]

I remembered dry food shelf life is around 30 assumed MRE goes through the same treatment. Then found the source for you: http://ce.byu.edu/cw/womensconferenc...ns/pdf/52a.pdf

Granted the definition of edible is different (bacterial content vs when the food stopped tasting good). Still civilian MRE should have at least 7 years life while still tasting good.

The old canned army food is known to last 100 years without bacteria. Whether or not you can stomach it is another story.

[VJ99]

I love the irony of pairing:
"I have no faith in fiat money" with "Can I get a tax benefit"
LOL
You have no faith in fiat money, therefore no faith in government but you are still going to file your taxes?!?!?

Hi
I would like to invest in physical gold & silver
I have no faith in any form of fiat money or any form of paper security in today world finance system...

Is it a good idea to use Line of Credit (also known as Credit line) to purchase physical gold?
What risk involved, and is there a better way to invest in physical gold.

(Side question - can I get any tax benefit for investing in precious metals?)
Thanks.