Welcome To The Conversation: Broker Charles Schwab Now Suggesting Gold To Clients & EROI Update

In an interesting change of events, Retail Broker, Charles Schwab is now publicly talking about Gold investments to their clients. Financial expert Vic Patane, and I discussed this as well as many other interesting topics.

It seems as if the Financial Advisors missed the boat suggesting gold ownership to their clients when the price moved from $250 to $1,900. This time around more clients are putting pressure on the Financial Advisors to allow them to include gold in their portfolios. However, Vic and I discuss how these brokers will likely suggest shares in the GLD ETF rather than physical gold as they don’t make money on putting their clients into real metal.

Furthermore, we discuss the issue of precious metals storage and how many companies are taking a nice CUT of the fee. We suggest investors educate themselves about the precious metals storage business and find out what they are being charged to store their metal.

Also, I add an energy update and describe how the Falling EROI - Energy Returned On Investment is impacting everything today. I include an interesting example that makes it easy to understand why the Falling EROI is making it harder and harder for the middle class to make a living today.

Here is part of the email Charles Schwab recently sent out about Gold Investing:

A Guide to Investing in Gold

Learn about why gold is considered to be so valuable as well as various vehicles that allow you to hold an interest in gold.

By: Schwab Trading Services

Investors and traders have long held a great fascination with gold. Some of this fascination is no doubt related to the mystique that surrounds the yellow metal. Some of it is also due to the intrinsic value involved in holding a piece of essentially indestructible metal. In any event, due to its unique qualities, gold has long offered investors a one-of-a-kind investment opportunity.

In this guide we will discuss the reasons why this has been, why it remains so, and why gold will remain a unique investment opportunity far into the future. But even more importantly we will also detail a variety of investment vehicles available that can allow you to hold an interest in gold and to participate in bullish and/or bearish price movements in the world’s most renowned precious metal.

The decisions regarding if, when, and how to allocate investment capital to gold are personal ones. The purpose of this guide is not to tell you when or even whether to make such a commitment, nor to tell you which investment vehicle to choose. The goal of this guide is simply to provide you with an understanding of:

1. Reasons why an investment in gold may be right for you.

2. Primary factors that can affect the price of gold.

3. Commonly used investment vehicles for trading gold and their relative advantages and disadvantages.

Disclosure: None.

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