Gold Trading Boot Camp: How to Master the Basics and Become a Successful Commodities Investor

CHAPTER 7

The Golden Bull

While gold is the safest store of wealth, even more so than real estate, you may be skeptical.

Recall the plight of Moses and the slaves he led out of Egypt. As told in the Book of Exodus 32:4, Moses’ brother Aaron fashioned a “golden calf” as an object of sacrifice while Moses scaled Mount Sinai. Struggling against Mother Nature, without claim to any land, short on water and food, the Israelites maintained their wealth in gold, mostly in the form of jewelry and trinkets. According to the story, Aaron took up a collection, mostly of gold earrings, melted the gold down, and created a near-life-size calf (cow, or bull).

To say the least, the moral of the story is skewed away from the mind-set of a present day, capital markets speculator. On his return from the mountain, Moses was enraged at the sight of the golden calf, slammed the commandment tablets to the ground, and ordered the golden calf burned.

My point is simple. Gold as a store of wealth outdates the U.S. dollar, and all paper currencies, by many centuries. From the Roman Empire, through the Mongolian Empire, to the English colonization, right down to the printing of the Ecuadorian sucre, paper currency regimes have come and gone, but gold has remained constant.

Of course, the price of gold is anything but constant. This is what makes the current environment so exciting and, at the same time, so ominous. Beginning in 2001, the price of gold began to rise relative to nearly every paper currency ...