Chart usGOLD   Chart usSILVER  
 
Food for thought
We have gold because we cannot trust Governments
President Herbert Hoover  
Search for :
LATEST NEWS  :
MINING STOCKS  :
Subscribe
Write Us
Add to Google
Search on Ebay :
PRECIOUS METALS (US $)
Gold 1298.60-5.22
Silver 20.570.03
Platinum 1477.00-6.25
Palladium 879.802.05
WORLD MARKETS
DOWJONES 1704661
NASDAQ 446722
NIKKEI 1561889
ASX 558111
CAC 40 438338
DAX 968183
HUI 242-2
XAU 1020
CURRENCIES (€)
AUS $ 1.4295
CAN $ 1.4535
US $ 1.3412
GBP (£) 0.7917
Sw Fr 1.2161
YEN 136.9710
CURRENCIES ($)
AUS $ 1.0659
CAN $ 1.0837
Euro 0.7456
GBP (£) 0.5903
Sw Fr 0.9067
YEN 102.1270
RATIOS & INDEXES
Gold / Silver63.13
Gold / Oil12.93
Dowjones / Gold13.13
COMMODITIES
Copper 3.23-0.02
WTI Oil 100.47-1.20
Nat. Gas 3.76-0.01
Market Indices
Metal Prices
RSS
Precious Metals
Graph Generator
Statistics by Country
Statistics by Metals
Advertise on 24hGold
Projects on Google Earth
Real estate priced in gold
Published : November 13th, 2012
591 words - Reading time : 1 - 2 minutes
( 10 votes, 4.4/5 ) , 1 commentary Print article
 
    Comments    
Tweet
Keywords :   Gold | Purchasing Power | Real Estate |

 

 

 

 

Throughout history many fortunes have been made and lost in real estate. Luck has of course played a part in these outcomes, but the main reason for changing fortunes is the decisions that were made, whether good or bad. Often the bad decisions were made because of the misunderstanding of some basic elements needed to choose real estate wisely.

For example, returning from a business trip not too long ago I got into a conversation with the driver of a car that I had arranged to meet me at the airport and take me home. This gentleman was in his late 60s and in a very jovial mood because it turns out, he had just sold his house in the outskirts of London. Thus, he was now ready to retire and was excited about the prospect of moving to the southwest of England where he planned to buy a cottage to enjoy his retirement. But as it turns out, that wasn’t the only reason that made him happy.

He crowed about how well he had done on hisinvestment”. Apparently, he bought the house in 1964 for £3,100, and was now quite delighted by the £212,000 selling price it had achieved.

When I arrived home, I decided to see just how well he really did and grabbed my calculator. I recognised that £3,100 was a lot of money in terms of 1964 purchasing power, and was curious what £3,100 would presently buy in real terms after adjusting for inflation. So using gold as the base for my calculations, I determined that the cost of his house in 1964 was 248 ounces, which at the £985 per ounce exchange rate prevailing when he sold his house were worth £244,000.

In other words, he if bought gold in 1964 and simply held on to it, he would have had £32,000 more purchasing power than he did in 1964. Thus, in real terms his house was worth £32,000, or 31.5 ounces of gold less than what he paid for it.

So despite being delighted by how well he had done, all things considered, he did not make a very good “investment”. In fact, his investment lost money, and I am not even considering here the amount of money he spent for maintenance, upkeep, taxes and other running expenses. But here is another important point he missed completely.

He was not making an investment by buying his house. He was buying shelter. That is the principal use of any home, and it is what he enjoyed for nearly five decades. And the shelter his house still provides is the reason that he was able to sell his house to someone else.

I think this example shows how misguided mainstream thinking has become. The ever-inflating fiat currencies used worldwide have terribly distorted what should be a simple, straightforward decision making process and means for thereafter evaluating your decision, like whether to buy a house for the shelter it provides.

The economies of many countries today have been devastated by real estate speculation. Easy money policies of central planners encouraged bank lending that created an artificial boom, much of which was the result of real estate speculation. These excesses that distort and make more difficult the decision-making process inevitably need to be unwound as banks and borrowers reduce their leverage to bring their balance sheets back to normal levels, a process which has been underway now for a few years. To better understand this process, I always recommend using gold to assist in your decision making process.

 

 

Tweet
Rate :Average note :4.4 (10 votes)View Top rated
Previous article by
James Turk
All articles by
James Turk
Next article by
James Turk
Receive by mail the latest articles by this author  
Latest comment posted for this article
Fine analyse de James Turk sur le match or contre immobilier. L'or s'en sort gagnant largement sur longue période. Je regardais récemment des vidéos sur la fusion froide une recherche dont les premières révélations ont eu lieu en 1989, il y a plus de 20  Read more
Roxan - 11/13/2012 at 1:35 PM GMT
TOP ARTICLES
MOST READ
TOP RATED
MOST COMMENTED
Editor's picks
RSS feed24hGold Mobile
Gold Data CenterGold & Silver Converter
Gold coins on eBaySilver coins on eBay
Technical AnalysisFundamental Analysis

James Turk

James Turk is the founder of the Free Gold Money Report and of GoldMoney.com. He is also the co-author of The Coming Collapse of the Dollar (www.dollarcollapse.com).
James Turk ArchiveWebsiteSubscribe to his services
Most recent articles by James Turk
7/29/2014
7/22/2014
7/17/2014
7/15/2014
7/14/2014
All Articles
Comment this article
You must be logged in to comment an article8000 characters max.
 
Sign in
User : Password : Login
Sign In Forgot password?
 
 
       
Fine analyse de James Turk sur le match or contre immobilier. L'or s'en sort gagnant largement sur longue période.
Je regardais récemment des vidéos sur la fusion froide une recherche dont les premières révélations ont eu lieu en 1989, il y a plus de 20 ans. Et cette technologie serait sur le point d'aboutir grâce à un ingénieur italien. Il s'agit d'une découverte supérieure même à celle de l'électricité, puisqu'elle permettrait l' "économie de l'hydrogène". Avec 1 gramme de nickel vous produisez l'équivalent de 5 barils de pétrole (soit 159 x 5 = 795 l par gramme de nickel). Votre facture de chauffage pour une maison moyenne sera de 30€/an. La voiture électrique deviendra une réalité avec une autonomie supérieure à celles des automobiles à moteur fonctionnant au pétrole et un coût de carburant réellement dérisoire.
La fusion froide est une bombe à faire plonger le monde actuel dans une vraiment vieille antiquité. Les mp aussi seraient bien mal en point.
Receive 24hGold's Daily Market Briefing in your inbox. Go here to subscribe or unsubscribe.
Disclaimer