This lack of understanding is not confined to the public but also prevalent with some financial experts. One example of this is one of the more vocal anti gold experts in recent months – leading Bloomberg columnist Barry Ritholtz.
This lack of understanding results in many investors being very exposed and at risk of financial losses due to their significant over exposure to paper assets and fiat digital currencies and complete lack of any allocation to gold whatsoever.
These experts are highly intelligent people. As are many in the public and yet the concept of diversifying and having an allocation to gold is utterly foreign to them.
The public have little terms of reference except for movies such as Goldfinger and fairytales about Leprechauns and crocks of gold. Indeed, their primary reference point is often jewellery, wedding rings and of course the recent ‘cash for gold’ phenomenon.
They have no understanding of the central role gold plays in macro-economics, geopolitics and of course monetarily.
They have no knowledge of the fact that gold has protected people throughout historyfrom financial and economic crashes and from currency devaluations. The significant body of academic research on gold showing it to be a hedging instrument and a safe haven asset is ignored and unknown.
We find ourselves constantly confronted by the same set of ill-informed opinions on gold.
Many of these misconceptions were encapsulated in a 2013 article by Barry Ritholtz, with the peculiar title “12 Rules of Goldbuggery”.
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