Gold Investing: Prominent Macro Strategist Analyzes Costs and Security Risks

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On Social Media Platform X, well-known financial expert Lyn Alden discussed the complexities of buying gold in a recent post. She explained the balancing act involved in considering factors like cost, authentication, and quantity.

In the realm of finance, Alden is renowned for her proficiency in devising investment strategies and dissecting economic data. She is the mastermind behind Lyn Alden Investment Strategy, a platform where she delivers research encompassing macroeconomic trends, individual stock evaluations, and personal financial planning. By merging her engineering background with a nuanced grasp of financial markets, Alden offers invaluable perspectives for investors exploring both conventional assets and cryptocurrencies. Her work frequently touches upon themes such as monetary policy, currency fluctuations, and significant economic transformations, providing a well-rounded perspective on the intricacies of the financial world.

Last year, Alden penned down the book “Broken Money: Understanding Our Malfunctioning Financial System and Proposing Solutions.” In this publication, he explores the historical development of money, focusing on how technological innovations have shaped its progression. While politics can impact monetary structures in localized and short-term ways, it is technology that drives these systems forward on a global and long-lasting scale.

The objective of this book is to provide readers with a thorough knowledge of money’s historical background and its practical applications, both theoretical and real-world. Lyn Alden takes you on a journey from the rudimentary forms of currency like shells and gold, to the emergence of paper bills of exchange and the founding of central banks. Furthermore, she delves into the essential character of money, providing readers with valuable insights that help them assess diverse monetary innovations and concepts. From ancient trading practices to modern-day technologies such as the telegraph and Bitcoin, Alden explores the evolution of money in depth.

Over 1,000 people have left ratings or reviews for Broken Money on Amazon now. I’m grateful to each person who took the time to share their thoughts.

— Lyn Alden (@LynAldenContact) April 17, 2024

Based on Alden’s information, the price of gold was approximately $2,400 per ounce as of April 20, 2024. However, buying a standard gold coin entails an extra cost in the form of a premium, which ranges from 3% to 5%. This translates to an additional expense of around $100.

Smaller gold items, such as coins, have a greater surface area in relation to their weight, resulting in higher production costs for Alden. However, this design feature makes it harder for counterfeiters to imitate these items by using denser materials like tungsten. On the other hand, larger gold bars are less expensive per ounce with approximately 1% added costs. Yet, they pose verification difficulties, often referred to as “tail risks,” due to the challenges of ensuring their purity throughout.

In addition, she discusses the financial aspects of different sized gold coins. A gold coin that weighs an ounce offers a good value for investors as it has a reasonable cost and can be easily authenticated. However, coins on the lighter side, like those weighing only one-tenth of an ounce, have significantly higher prices due to their premiums. These premiums can reach up to 37%, causing a $240 coin to cost $331 instead. While these small coins are less susceptible to tampering, the high premium is considered excessive compared to their actual worth.

In wrapping up her investigation, Alden underlines to investors the necessity of factoring in the costs of authenticating possessable assets such as gold coins. Moreover, she brings up the extra expenses involved in safely moving gold, which encompasses insurance coverage and potential complexities arising from border crossings.

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2024-04-21 17:24