As banks dump the US dollar, gold is seen as the go-to investment. But will it turn out better than stamp collecting or crypto?

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Photo above - a recent survey says savvy investors are bailing on the US dollar and flocking to gold. Should everyone else do it too?

Banks now hate the dollar. How do we know this? Lord Norman Lamont, a member of the UK House of Lords, and chairman of a private investment advisory company, asked them. See link below.

Actually, Lord Norman didn’t ask all the banks. Only the central banks of 75 of nations. Which may sound like a lot, but only about 6 of those nations matter in banking. They account for 70% of the world’s GDP. The 75th largest nation is Serbia, to put this in perspective. I’d have stopped asking banks for their investment plans before I got that stage, if I was Lord Norman Lamont.

Two of the top 6 nations are definitely dumping the dollar: China and India. They’re charter members of BRICS, formed by rogue regimes in 2009 to topple the US Dollar. Brazil, Russia, India, China and I forget who the “S” stands for. Ethiopia and Iran joined recently. They're trending!

BRICs members will be pressured to move their dollars into China’s yuan. Even as Chinese private investors are scrambling to send their yuan holdings to places like Canada, the US, and the UK. Which could land them in jail, if they don’t bribe the right officials in Beijing.

Back to gold. They aren’t making any more of it. Or land. Except Dubai and the Netherlands, which are engaged in “dredge and fill” land engineering projects 24/7. They’re not making any more collectible postage stamps either, but my gut feel is that gold or land will outperform the British Guiana 1 cent Magenta (1856). It's possibly worth $8 million if it’s not counterfeit. See the problem with stamp collecting? Even with the Netherlands and Dubai making counterfeit land, it’s not the same kind of existential risk.

Although it’s theoretically possible that the 17 cent Chinese Yuan will become the dominant currency on Earth, I’d be surprised if this actually happened. Or the Russian Ruble. Or the Indian Rupee. Those last two are less than a penny each. As are virtually all the crypto currencies.

I’d go for crypto, but as I noted in a column earlier this month there are now 2.5 million active crypto currencies, and another 10 million abandoned ones. JP Morgan Chase and Rolls Royce became new crypto issuers in June. Someone also launched a Pepe the Frog memecoin, if you like long odds. It's like buying a Powerball ticket, maybe? Most cryptos are, in fact.

If you’re a “prepper” or a survivalist, gold is getting promoted in various social media forums. I’m sure places like Reddit have strong opinions on this. Gold is portable, and you can carry a bunch of it in your pocket (a nugget the weight of a Hersey bar is worth $5,000). Bullion might end up being hoarded in those 75 nations' central bank vaults, intensifying the bubble it’s already in. Gold is up about 50% over the past 12 months already.

But if things stay dicey, be careful how you spend your Krugerrands. Think twice before you connect with someone on social media who says they have a gun for sale, if you have "real money". At the end of that face-to-face meeting, someone could end up with both the gun and the gold.

I’m just sayin’ . . .


Gold seen as biggest winner from dollar diversification at central banks, survey says

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