Gold and Silver has a natural intrinsic value because it is rare and highly sought after.
Gold and Silver resists inflation because the amount of gold and silver is not increasing. The amount of gold and silver on earth is constant. Some gold and silver is mined and circulates above ground while some are not mined yet and left in the bedrock. The total amount is unchanged.
Paper money comes and goes while gold and silver remains. No paper currency has survived more than a few decades, while the value of gold and silver has been consistent over thousands of years.
Gold and silver are the asset classes that have historically fared best in times of high uncertainty and high inflation. In a time where assets like stocks, bonds or real estate are associated with high risk or uncertainty appears to gold and silver as one of the best options to protect and insure against one crashing financial, banking and monetary system.
Some of the reasons to buy gold and silver:
• Gold and silver is an investment that can serve as an insurance in uncertain times.
• Gold and silver can act as a hedge in each portfolio for better risk-adjusted return
• Gold and silver protect against inflation and the erosion of the value of money
• Gold and silver retains its purchasing power over time
• There are many indications that the value of gold and silver will rise in the future, while other asset classes like stocks likely to be a bad deal.
• Demand is rising and while production is stationary or falling.
• Gold and silver have been used since ancient times, and may continue to be used as a liquid asset value preservation and money.
• Especially silver has industrial uses in areas such as alternative energy or IT products, which supports the high value.
• Owning physical gold and silver is no counter party risk. You do not rely on any bank, securities broker, commodity exchange or certificate issuers.
The idea of owning physical gold, instead of some form of derivatives or gold hedged fund is that you must have physical control over the gold, and that it should be independent from the financial system.
I can start by pointing out that the only way you can keep your gold so it is covered by any insurance is in safe deposit boxes at the bank. Do it. The exception is someone that has 1-2 gold coins, then the home insurance would cover it.
Even if the bank goes bankrupt, it is still your gold there in the locker, and you will soon get access to your tray through bankruptcy nominee.
However, there are drawbacks, such as the bank reports that you have a safety deposit box to the Tax Agency. So gold is not protected against the state. Another disadvantage is that the bank is open 9-15, 9-17 maybe some day. If by some reason you will need your gold during other hours, if you suddenly need to leave the country or by some other reason you will need to leave the gold behind.
Another variant is keeping gold in a safety deposit box abroad, where you then can escape to, and which thus Tax Agency does not find out that you have either, if they do not buy stolen data from SMB Swiss bank.
As for silver, the problem is that silver takes more space. Larger amounts require many large safe, but tells anecdotes about those who used 100 oz-ingots (3.11kg) as paper weights and had burglaries without them being stolen. At least the former silver fairly unknown to the thieves, flat-panel TV is more interesting.
But my recommendation is a bank safe deposit box. If the authorities are after you, or if it starts to feel like society perish within a few days, maybe you should consider spreading the risk a little.
Safes are not very expensive and can also be used to backup hard drives of the household gathered information, important photos and important documents.
To secure a safe it should be bolted to the ground to further prevent theft. It's also a good idea to choose a model that is really heavy.
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