Marc Faber Warns: Store Your Gold Overseas

Marc “Dr. Doom” Faber has become quite well-known not only for his bold predictions, but for his investment prowess, as he effectively predicted and navigated the current financial fiasco. Along with the fact that he feels our nation as a 100% chance of entering another recession, the doctor has yet another warning for investors out there; don’t store your gold in the United States. “You ought to own some gold but don’t store it in the U.S., the Fed will take it away from you one day” said Faber, referring to what he feels will be an inevitable gold confiscation part deux [for more gold news and analysis subscribe to our free newsletter]. 

Gold has gobbled up the headlines in the past few days as the asset surged upon the announcement of QE3. This third round of quantitative easing will be the most aggressive and possible to most damaging yet. Bernanke and company have agreed to purchase $40 billion in MBS each month until they see fit, a blurry timeline that will be extremely difficult to predict. Given that the Fed has decided to dilute the dollar, a number of commodities have become much more attractive, especially gold. The precious metal has long been a safe haven for investors all around the world, but Faber warns that gold owners need to be wary of where they store their bullion.

It may seem a but over the top to state that nobody should store gold in the states, but his reasoning is sound. With a mountain of debt and a weakening dollar, it seems that QE3 has only delayed the inevitable downturn of our economy. While some feel we may hit a double dip sometime soon, Faber is betting that the collapse will be one of the worst of our time and force the Fed to confiscate gold in order to stay afloat. For those who believe in Faber’s theory, the prospect of moving your gold storage or re-allocating can be a bit scary. Below, we outline several options for gold storage over seas [see also Warning: John Hussman’s Model Shows the Worst Short Term S&P Risk-Reward in a Century].

  • Bullion Vault: If you want straight up physical gold without any hassle, this is one of the best places in the business. Investors can store their gold in a London or Zurich vault and the buying/selling process is designed to be as painless as possible. Note that silver can also be purchased and stored through this website.
  • Physical Swiss Gold Shares (SGOL): One of the most popular gold ETFs out there, this product invests in physical gold that is all stored in Zurich. With nearly $2 billion in assets, think of SGOL as nothing more than GLD with a different, and possibly safer, storage location [see also Why No Investor Should Own GLD].
  • Physical Asian Gold Shares (AGOL): Not a fan of Switzerland? No problem. This ETF is also physically backed, but holds all of its bullion in a vault in Singapore. It should be noted that this product is much smaller than SGOL, with just $77 million in assets and trades only a few hundred times per day.

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Disclosure: No positions at time of writing.

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