Gold has always been, well - “as good as gold”.
The very thought of the stuff puts a twinkle in the most pious of eyeballs, and turns the hardest of warriors to jelly at the thought of taking small sacks full home at the end of a hard day’s plundering.
Evidence from Global Investor Group now suggests millennial’s have caught the bug too.
The challenge for an age has been how to get hold of gold, keep it safe and have it available when you need to spend it.
It’s been a physical challenge.
Gold is heavy, hard to carry in volume and very shiny thus attracting loads of unwanted attention when paying for your daily loaf of bread.
To resolve this problem, many years ago, centralised government’s (or various monarchies) began issuing promissory notes, offering to store your gold safely for a fee. Genius! These promissory notes later became known as cash.
In recent history, the concept of having gold sitting in a vault, of equal value to the promissory notes, began to lose favour with these centralised governments.
They came up with the cunning plan of moving the world away from the “gold standard”. Effectively issuing promissory notes backed by nothing. Even greater genius!
This has been our financial reality now for around 70 years and it’s the first time in history that there’s been no underlying intrinsic value to financial transactions.
In more recent history, these centralised governments have gone a step further with an entirely new plan. They now don’t even bother printing the paper for the promissory notes, preferring to issue “digital money”.
We’ve been encouraged to adopt these new digital currencies, such as the Pound “Sterling” or US dollar, as a convenience. And to be thankful for it.
After all, we can buy anything we want now online and have it delivered the next day without the need to carry cash, or leave the couch. Even better, we don’t have to wait for change in the bus queue, we only tap our card.
Well, as my granny used to say, “it’s all fun and games until somebody loses an eye”.
Can you count how many sword jugglers there are in power today? It’s a little frightening.
Add this uncertainty about current global financial structures, to an unstable Middle East and we have the makings for a significant rise in gold value in coming years.
Gold has already risen 18% over the last 12 months and whilst it is fair to say was relatively flat for two or three years prior, many are predicting now that we’ll start to see significant value added to this most traditional means of storing wealth.
Banks may come and go (some people have forgotten how many high street banks in the US and UK failed in the last 20 years), but a tidy stack of shiny 1 ounce gold coins buried under the rosemary bush will always give a sense of comfort and security.
The problem gold has faced in recent years, and in part the cause for its apparent unpopularity as a currency is that it is not “sexy” when compared to bitcoin or buying a pizza online.
That problem at least may now be solved.
Younger generations are re-inventing ways to buy, store and trade in gold, along with many forms of traditional trade, like barter. Whether it’s the local hipsters at a farmers market swapping their carrots for somebody’s cheese, or the block chain tekkies developing applications to securely store physical wealth, dissatisfied millennial’s are looking for ways to stamp their own flavour on traditional financial markets. Global Investor Group has found a solution.
One such endeavour is Credyts.Gold
Credyts will launch in the UK this year as an invitation only private wealth club offering a digital token, or “Credyt” which is secured on the block chain.
The key difference however is that this particular digital token will be backed 1:1 with physical gold stored locally in a high street vault.
Members have the opportunity to buy and sell goods through a classified exchange using their Credyts (I’ll give you 10.25 Credyts for your second hand Audi), or spend them at a growing number of merchants nationwide. Credyts can be traded anywhere, globally, right away, however the gold will be housed in Capital city vaults from London and Paris to Sydney, Mumbai and New York.
Arguably, the best part is, should a merchant or member want to hold their gold themselves, or “cash out” of Credyts, the physical gold will be couriered directly to their door within 72 hours (and their digital wallet updated).
The team at Credyts are in the final stages of prelaunch preparation and are now inviting enquiries with regards to membership.
Credyts representative, Aaron Banks, notes a high level of interest from millennial’s who seek the convenience to spend their money online, or electronically at point-of-sale, whilst having the security and comfort of knowing those transactions are backed by something “organic” and real and which has intrinsic value. Banks notes that these core values are closely aligned with those of the millennial’s desire to trade ethically and sustainably, while enjoying the ease of apps in a connected world.
A significant added benefit for anyone applying to become a member of Credyts seems to be that if accepted, they will be stocking their digital wallet with physical gold bought via their existing debit/credit card, or through bank transfer. Effectively converting their mainstream “cash” into something of real value.
The gold they have just bought, sold or traded will then follow global markets in terms of value and if the indicators we see are correct, will rise on its own account.
Gold has always been a traditional store of wealth and we are reminded of that as recently as last week when, following the US assassination of a top Iranian general, the resulting unease in the Middle East caused the value of gold to increase by 3% in a single day.
Further, Global Investor Group advised our private wealth clients two years ago to buy gold, or gold related stocks and I’m pleased to say those that took that advice, and joined our gold portfolio of stocks, have seen the value of that investment increased by over 60%.
It does all seem to bode rather well then for our old friend gold.
Perhaps now with the ability to buy physical gold and to trade it digitally, a new era might just enjoy the best of both worlds. A strong intrinsic store of wealth, coupled with the convenience to buy your daily loaf of bread without attracting too much attention.
If you have any thoughts to contribute regarding gold, or would like an introduction to the team at Credyts, contact the author directly – abanks@globalinvestorgroup.co.uk