I have long held the opinion that it is good to have savings but where do you put the money? In a bank? Not on your nelly….. Have you seen what has happened to the WORLD banks in the last few weeks, I don’t think the bank is a good option and especially when the interest rates they offer are always such that the earnings never keep up with inflation so your money gradually becomes worth less in real terms.

You could buy a business that could bring money in but a lot of businesses are struggling because of the banking crisis and there is quite a bit of risk there.

You could buy shares, buying right now could be good as the value has dropped out of the markets and you could be getting bargains. But then again the financial crisis could just as easily get worse and you could lose you money same as many investors who have had thousands wiped off their portfolios just in the last few days.

The answer is gold. The value of it has risen 25% during the last year and I believe it will get more value as this banking crisis deepens. I have only today sent money to my Bullionvault account to be able to buy more gold. Putting my money where my mouth is…

Here is part of an email from Paul Tustain of Bullionvault in which he talks about gold in regards the present turmoil.

And Gold?
=========

I now move to gold, and an avowedly selfish point of view.

I think it is almost certain that the proposed bailout will
be good for me personally, because it will be good news for
BullionVault. That’s because I believe we will be avoiding the pain
of a sharp correction. Instead we will get many years of miserable
underperformance in shares, bonds and deposits.

With no bailout, gold would probably rocket. Within a few months
it would have fully appreciated and it would be time to exit gold
and start buying bombed-out productive assets. The speed of such an
ascent in gold prices would be highly profitable for gold owners
- including me – but it would probably prevent Bullionvault from
aggregating more than a few thousand new customers, and my personal
ambitions for Bullionvault would never be met.

Instead, with a bailout, I anticipate some temporary relief and then
a long, slow, miserable slide in mainstream investment performance,
accompanied by a steady rise in gold. Every month of it will cause
a few thousand more people to join Bullionvault.

So – entirely hypocritically – I believe one outcome is required,
yet hope for another!

Gold price chart by BullionVault.com – Click for live prices

Have a look at the charts for gold and you will see there is a steady rise in the value over the long terms and it will go higher. The governments don’t know what to do and I think that much of the solutions they have come up with will actually further undermine the financial system. No one has confidence in shares so why buy, no one has confidence to borrow money and the banks lack the confidence to lend too. That is all a recipe for more pain.

I will be getting more gold for sure and the easiest way I have found to buy it is with Bullionvault.