WARREN BUFFETT is Against Investment in GOLD, Should You INVEST In GOLD?

March 11, 16

WARREN BUFFETT is Against Investment in GOLD, Should You INVEST In GOLD?

Greetings from Hitesh! Readers have appreciated our strategy of dealing with losses in our last post. Recently I came across a post in which they have given some reasons not to invest in GOLD. So, let us see them first.

1.      We (India) are paying in Dollars for our GOLD and precious FOREX reserves goes for buying for UNPRODUCTIVE GOLD!!

2.      They ARGUE that We are generating USD by selling our GOODS/IT services and things like that and we are giving back the same USD to them to buy the GOLD(As we do not produce much GOLD in India).

3.      They further ARGUE that it leads to Devaluation in our currency due to our purchase of GOLD.

4.      Many others have also argued that it makes no sense to keep money in GOLD as it is not generating any income. In fact, you have to pay for keeping your GOLD SAFELEY in LOCKERS.

In USA, WARREN BUFFETT has always been against GOLD investments and he has also given above reasons for not investing in GOLD.

What is OUR VIEW?

It is EASY to COPY PASTE some NOTED investor / Successful person in any field. The missing link is COMMON SENSE/ Laws of the LAND and Development stage of the COUNTRY. Most guys in their over enthusiasm to copy paste forget these factors and they end up misguiding you with their so called LOGICAL ARGUMENTS.

Let us understand India’s GROUND REALITIES:-

1.     Our BANKS have LANDED TONNS of money of NORMAL GUYS to A group companies and those A group companies are not paying them interest also. Forget about CAPITAL!! It means NORMAL guys have LOST money by TRUSTING BANKS. (It is another matter that GOVT is REFINANCING the SAME. The Indian WORD is RECAPITALISAION and NOT QE, that’s the difference).

2.     Recently KING of GOOD TIMES – FLEW away and our AGENCIES are busy blaming one another rather then bringing back the DEFAULTER to India.

3.     Go to any PUBLIC SECTOR Bank and the staff is too busy with their PAPER WORK / talking about their PF and GRADUITY/ what they ate last night. They are not interested in servicing NORMAL GUY.

4.     Go to PRIVATE SECTOR Bank and the STAFF is waiting to SELL you Mutual Funds / LOAN / SIPs or Insurance. They are also not interested in you – if you just want to do NORMAL-banking operation with them.

5.     Normal investors have lost CRORES of rupees in SHARDA CHIT FUNDS / SAHARA GROUP / Multi Level Marketing Companies. Many are still CHEERLESS due to PEARLESS Finance.

6.     Recent incidences with LEADING Mutual Funds have proved to us that AAA rated DEBT Funds can also take away your money.

7.     Ministers are making you PLEAS to GIVE up the GAS SUBSIDIES but they have got the increment in their SALARIES!!

8.     Another funny aspect of Indian BANKING is – they will give loans to INDUSTRIALIST to recover their NPAs but if NORMAL guy is UNEMPLOYED – he will not get even ration from his local KIRANA shop on CREDIT.

9.     Government is taking out CASH from PSU companies in the form of DIVIDENDS to meet their expenditure targets rather than using those CASH in some productive purpose.

Let us see VIJAY MALAYA’s Example -  

I can't withdraw more than 20,000 rupees a day from my account. He withdrew 215 Cr and left the country.

The minimum account balance I need to maintain is Rs.1000 to Rs.10000 depending on Banks. But he can maintain a minimum balance of Rs -1500 Cr.

I work quite hard and my last birthday party was thrown by a friend on his brother-in-law's terrace; I spent 200 bucks on cab. When he turned 60 this year he burnt 90 Cr on his birthday party on a private island in Goa, and flew down Enrique.

I pay my modest EMI on time fearing phone calls and letters from the bank. He owes Rs 7000 Cr to 17 banks and nobody knows on which number he's available or where to send the damned letters.

If I owed the amount of money he owed, I would have taken a bus or hitched a drive for free (to save whatever little I have left) to escape my debtors. But he took a chartered jet and flew to a private estate near London.

But everybody is busy calling him a huge failure. They're cracking bankruptcy jokes, poor man jokes, fat man jokes and absconder jokes on him. Let me break this to all of you. The joke, is actually on you guys. If you ask me, he's not a failure; he's the biggest success story today.

In such a SCENARIO – the poor guy is left with ONLY GOLD as his security. He can’t invest in REAL ESTATE, as he does not have big money for the same. He is EDUCATED by not Financially Literate to think about investments in ESOTERIC Products. Thanks to his MIDDLE CLASS upbringing, he is too straightforward for this Round EARTH.

We have a GRASS root level corruption and it is difficult to remove in short period of time. It will take one or two generations and TRICKLE DOWN OF WEALTH with NORMAL guy before you can PREACH him about not investing in GOLD. 

IMPORTS of GOLD V/s. IMPORTS of CONSUMER ITEMS:-

Look at the import of Ultra Luxury YACHT / CARS  by Mukesh Ambani and other ULTRA RICH PEOPLE / Personal Planes by many Billionaires. Look at the import bill of MOBILES and other electronic Items. Look at the TRAVEL Expenses of Indians when they go to ABROAD. Many such examples can be given which is also using our FOREX.

The difference between GOLD and above is – you can convert GOLD into USD with relatively same valuations in the long term but all of the above are JUNK once you paid for them!!

So, I think those who are investing in GOLD should be appreciated as they are keeping the WORTH of county same by not spending on LIFE STYLE Expenses.

I have yet to READ/HEAR MEDIA ANALYST taking about RICH guys expenditure as a WASTEFUL expenditure in MEDIA!! The way they are talking about NORMLA guy’s investment in GOLD as WASTEFUL Investments.

MARTIN LUTHER KING JR had said “we have GUIDED MISSLE and MISGUIDED MEN”. Same applies to our MEDIA guys when they ASK you not to INVEST in GOLD. They are 100% misguiding you.

What NEXT?

My major success in Investment is due to following WARREN BUFFETT principles. However, I do not COPY PASTE him. I use his PRINCIPLES in Indian SCENARIO with 100% COMMONSENSE.

It is a FASHION with some guys to talk against GOLD investments. Fortunately, I do not follow any FASHIONS. I am a very SMALL INVESTOR and I keep my money where my mouth is.

Gold has moved from Rs.25000 to Rs.30000 in a MONTH and we see it going up further in coming months. If you want to follow MEDIA GUYS, we have no problem with you.

If you like our ATTITUDE/TRACK RECORD/TRANPERENCY in DEALING and Penchant for TRUTH – I suggest be with us and master the fine art of investments.

Happy Investing.

Follow me on Twitter @hiteshmparikh or on WhatsApp - +91-9869425399 or www.hiteshmparikh.com

Live With Passion…Invest With Passion.

Hitesh Parikh.

www.hiteshmparikh.com