Jul 5 2012
One of the most enduring symbols of wealth is the gold bar. Also known as gold bricks or gold bullion, gold bars are an artist’s visual short cut for great wealth. The number of “heist” movies that reverently show gold bars being sought after, protected and spirited away are too numerous to count here, but from the teetering vanload of gold bullion at the cliffhanger end of The Italian Job to the avaricious look on the face of Alec Guinness’ civil servant as he watches the gold bars melted down at the Royal Mint in The Lavender Hill Mob, we all know what the director means when bullion is included.
Just as gold itself stands for stability and value on the world market, gold bars stand for wealth and the good life. Part of this stems from the relative scarcity of gold as a metal. It has been estimated that if all of the world’s gold stocks (some 170,000 metric tons) were melted down into one lump, it would form a cube with sides of 68 feet in length. This could fit comfortably in the middle of a cricket pitch and would be worth a staggering $9.6 trillion.
This is a superficially attractive argument – especially for someone such as Buffet, who is always seeking investors in his industries – but as ever the truth is more complex, and depends on the situation that the potential saver or investor is in.
When economic times are good, then investing in such things as industry, land or real estate can arguably be a more lucrative option. However, in times where share prices are falling and the outlook is more uncertain, such as the times we currently find ourselves in, then gold is the investment that people know they can rely on.
The proof of this can be seen in the ever-increasing price of gold over the past decade, a phenomenon which has only gathered pace in the world after the credit crunch of 2008. This is the reason why smart financial advisors and asset management companies are urging people to stock up on their own gold bars right now – and why the smarter investor is taking heed.