Is now a good time to invest in gold?

27:37So do you believe that there's a correlation? And do you think Bitcoin's a good hedge against it? Well, the good thing about correlation is something you can measure physically. So I never pay any attention to the narrative. I just look at the numbers. And if you look at the numbers, you can separate all investments into two groups, right? You've got your risky assets, which are correlated with equity, where it's ranked with positive sentiment, right? People get excited, they get happy, they buy risky assets. Equity, Bitcoin would definitely fall into that category. And then you've got your safe haven assets, which do well when people are scared.

28:10And usually government bonds would fall into that category. And Bitcoin definitely wouldn't, because when people are scared, they sell Bitcoin. And in fact, if you look at the correlation of Bitcoin, you can actually model it very well with a three times levered NASDAQ index. So if you buy US tech stocks, three times daily levered, it actually tracks the value of Bitcoin incredibly well. And so it's a very much risky asset. Like a juiced up tech stock. Exactly. Because if you think about the kind of people that buy it, well, it's usually the same guys who buy the tech bro stocks as well, right?

28:46So that's why I think you have to look at how things behave. So is it a safe haven asset like gold? No. No way. No, no. Is it going to do well when people are kind of exuberant? Yeah. So that's how I think of Bitcoin. But as an inflation hedge, yes, beaten inflation because it's had unbelievably good returns. But is it safe haven? No. And yeah, inflation hedge over a long period of time. But in a moment where we get spikes in inflation, is it moving the opposite way? Because that's probably what people want, isn't it? They want to protect their portfolio from short, sharp shocks and inflation.

29:22And you've also got to look at the driver of inflation. So if it's going to be an oil shock, now historically, this is what happened in the past. You've got some kind of war in the Middle East. You worry about the supply of oil. You get an oil price shock. So you get a surge in energy prices. Equity markets sell off. And if you wanted a hedge, then gold would not be as good as oil. Or crypto, because it's energy hungry. So the cost of mining the stuff goes up a lot, right? But it's much more strongly driven by fear. So that's what would make crypto sell off in that kind of environment. So another hedge to have for that kind of crisis and that kind of inflation is some kind of commodity exposure in the energy space.

30:05So that would usually be some kind of gold. That would be usually some kind of energy ETF. But do you think people can hedge against these kind of things or they should even try? Or is time the hedge? Is it just you've got to kind of live through these moments? because you're saying now, oh, if there's an energy crisis or if there's a pandemic or if there's a terrorist attack, it's like they're all very different, right? And who knows what the next one's going to be? Should people just go, shit's going to happen. I've just got to ride it out. But look, for young people like you two, right, you're still accumulating your wealth at this point.

30:37So if there's a crash, great. You know, you can buy. Buy the dip. Yeah, yeah. And, you know, in 20 years time, you'll be thinking, oh, that was great time to buy and look at the value now. So that's why volatility for you and crashes are a great thing. For me, if I was about to retire, I'm not. But if I was, then I'd be worried that, you know, the value of the stuff I'm going to be taking out is now no longer going to be so good. So I think that's why it's probably better to think about these hedges when you're in retirement rather than pre-retirement. Because you guys can ride out volatility.

31:10You can monetize volatility by buying more stocks. For people who've got more gray hair like me, not so good. So that's why I think gold probably fits better into a portfolio post-retirement than pre-retirement. You mentioned that you bought some physical gold through an ETF. Is that different to, yeah, could you explain that a little bit? Because I assume if you're buying an ETF, you're buying digital. So yeah, is it like an ETF based on, backed by a big physical gold reserve? Yeah, they go buy the gold. They buy the gold and then you're investing in it, but you've got it digitally, but they're storing it for you.

31:44That's exactly what it is. So if you see a fund which is physically replicated or a physical gold fund, that means they've got a vault somewhere. And every pound you put into it, a pound of gold appears, you know, trundles into their vault. But do they charge you for, like, the storage of the gold? There is a fee, obviously, for that. So that's one of the drawbacks of these kind of products. But now we've got ones which have a fairly low fee. When I first started out, 2017, 2016, the gold ETFs were quite expensive. Now I think you can find them with sub 0.2 % assets under management fees, ongoing fees.

32:22What if they can't get their hands on the gold? You know, what if the inflows are so massive? Because again, I think some people insist on knowing where the vault is. So on some of the documentation for these ETS, you can see where the vault is. So for the London one, they store it in a London vault. And personally, I didn't used to be paranoid about this, but now I am, right? Have you been down there? To be like, which bit's mine? I would love to see that. It's funny because when I used to work for a Swiss bank, we used to have gold vaults, and that was the one thing everybody wanted to see. Of course.

32:54The Bank of England had got a big one, haven't they? No, it was because it was. No, no. Who was it who went down? Idris Elba. And I was like, oh, he gets to go everywhere. Do you know what I mean? They were like showing him around. And I was like, I mean, I'm not a gold vault, but there's something about that. Just being in a room with billions of pounds of metal. you know the bank of england yeah they came on the podcast guys it just helped a 2.0 get me down there yeah yeah i think it's fun in there i do think when i'm around bank you know that area there is just billions of tons of gold beneath my feet you know like that's that's crazy to think isn't it but you know recently what happened was that everyone was trying to get gold to go back to the u.s it was kind of an interesting trade and i was listening to the one of the bank of england governors he was talking about it because during one of the press conferences which i have to watch uh he was talking about how he couldn't get into the bank because there are so many lorries in the courtyard ferrying gold out to new york because people the big trade was i don't know if you were aware of this people were taking money from london taking it to new york because people thought there was gonna be or a tariff on gold so people were thinking well i'll take my uk gold i'll shift it to the us because there was a premium on us gold versus uk gold and the problem was that it's the wrong shape bar so you have to switch you have to take it to switzerland melt it down no put it into the right shape and then ship it to the united states unbelievably expensive but if the tariffs had happened which they didn't it'd be cheaper yeah you could make i look for lorries that are like sat on there suspension ruined yeah yeah just dragging on the scraping on the floor bread in there i had a contact who who worked in in banking quite high up and And they were telling me a story once over drinks around how one of the MDs at the bank was talking on the phone and was talking about tons.

34:46Like, oh, we need to move six tons and seven tons. And they were talking to me like, oh, I'm talking about getting cash up north. And we do it by the ton because we need to supply all of the banks when cash was a bigger thing. And they would load it onto vans that were unmarked or Hovis because they don't want like Barclays Bank van driving up the M6. or whatever. Not getting past Birmingham. Moving tons of notes in the backs of these unmarked vans or vans that they would borrow a bread van or whatever. And I was like, that's fascinating. Imagine you're just on the motorway and next to you there's a billion quid in cash in a van.

35:19Like a Hovis van. I think it's a McVitie's Jaffa Cakes. But yeah, look for the van that's set like this on the axle. You see, we shouldn't be making these podcasts and videos. We should just do a big heist. That's it. Yeah, yeah, yeah. We'd be the one that we'd just end up robbing a load of sanitary pads. we've got loads of bread yeah i did i did a bit of back testing i don't i try i know you're deep in the back testing game but i did a bit and what became clear was that when we talk about gold we often say oh if you invest in gold there and there it didn't do that well but actually if you dca'd into it and you were rebalancing that could actually have done quite well in portfolios so do you think we do a disservice when we talk about gold that we we focus on it in that sense And is there an argument that a dollar cost average approach as part of a portfolio is actually something that's good?

36:09It's just organically the way we invest. You know, we earn money, we save it. So we're all dollar cost averages, really. So, yeah, I think that's true. But really, you do have to look at the long term returns. And there it just isn't as good as equity. That's a simple fact. You know, you're going to get better returns if you invest in the global equity market, if you compare it with gold. And one of the things that really bugs me about gold is when I make a gold video, people say, oh, look, over this period, it did so well. Since 2000, it's done better than X, Y, Z. Exactly. And they're so selective about the time periods.

36:43And the fact is that it's just not going to be, I mean, intuitively. So when you invest, you're putting your capital at risk and you're buying something. So when you buy a company, it's something which provides value, it provides growing profits. and if it can carry on growing its profits at a certain rate, that's how quickly the price goes up. It tracks the profits over time. That's the long-term trend, right? So as long as they can carry on growing their profits more quickly than the price of gold would be increasing and more quickly than inflation would be increasing, that's not going to change because that's the fair price, right?

37:16So really it's a question about how quickly can companies carry on growing their profits. Now, my big concern at the moment, I guess, if I was thinking, you know, beyond my lifetime, would be what's going to happen with demographics? Because if the population on the earth is limited, then there's only so many things you can sell to so many people. So profits can't keep on growing forever if you've got a shrinking population. So that will potentially be a cap on growth for profits. But if we do manage to get off planet, which I think we will, then growth is unlimited. And in that case, you'd want equity, which gives you the unlimited exposure.

37:52Just say get off planet. yeah yeah like we're going to mars yeah yeah yeah so you wouldn't just colonize in our lifetimes no i'm here i'm talking about long term this is what my podcast co-host calls science fiction shit yeah but it's technical term but the point is that you've got limited resources on a planet and that caps your upside for equity if you've got unlimited resources for the whole solar system and beyond well you know suddenly the the the game's a very different one okay so talking of off planet then gold reserves off planet are quite high yeah there's asteroids that have got more gold on them than potentially the gold we have was brought to us on the back of celestial bodies yeah potentially born in the hearts of stars cast into the universe carried here on asteroids put in the ground we dig it up how poetic we form it into bars then we stick it back underground and go, look, it's worth money.

38:45It's pretty crazy. Yeah, it is poetic. It is poetic, yeah. I mean, I can kind of see why people love it. It's stardust, right? It is literally stardust. But if you think then that we are going to get to a point where we're off planet, are we also going to get to a point where we have so much gold that it becomes valueless and every electronic device is full of gold because we're like, well, there's loads of this stuff. Well, yeah, I mean, if the supply increases massively, one of the reasons why it's valuable is because it's scarce. And if it was suddenly very easy to get hold of, It's not actually scarce in that sense, though.

39:15The ocean's full of it, isn't it? We just can't get it out. Yeah, but the cost of getting it out is very high. It's hard to get at. There are lots of great stats on, you know, amount of gold out there. If you took all of the gold that's ever been mined, and about half of it's come out over the last couple of decades, but the entire history of humanity, it would be 22 cubic metres. Or, as we're in prom season, it would be, if you go into the Albert Hall, you know you've got the kind of orchestra section at the bottom that would fill up that orchestra section or 35 London buses. But that's it. That's the only...

39:47Oh, gold. That's all the gold. It doesn't sound that much. It isn't much. 35 London buses. Yeah, the majority of it's still in circulation as well. So a lot of the Roman gold is still floating about. So the stuff that you've got is probably... Yeah. Yeah. There was an interesting story in the FT about making gold, which I thought was interesting. They have a company from the United States where they've got this idea of using fusion reactors. Now, one of the side effects of... Alchemy. Nuclear fusion, yeah, that's exactly what it is. This thing, the process produces neutrons, which kind of flood out of the reactor.

40:20So if you put this isotope of mercury just outside it, gold has got 79 protons, mercury's got 80. So if you can get rid of one of those nasty protons... Gold turns into gold. It turns into gold. Radioactive gold, it has to be said. So you have to store it for like 14 to 16 years to get rid of the radioactivity. But you could produce about 5 ,000 tonnes of gold per gigawatt of electricity, which they produce. So again, you can make it, potentially. Is lead the other one? Yeah, yeah. That's very similar to gold, isn't it? It's funny because CERN made it out of lead. So in the Large Hadron Collider, they produced tiny quantities of lead, but that's not cost-effective.

41:02If you couldn't use a Large Hadron Collider to produce gold, it wouldn't produce enough. But this process presumably would. and because the gold price is so high it would it would be worthwhile doing it you can make other metals the same way but because gold is precious it would be the one you'd go for but there is an argument then that we might have a lot more gold in the future than we have today and we destroy that scarcity point exactly so i think that's another thing you have to kind of factor in as a risk scenario if there was a process which produced it then you know presumably the price would go down how big is this gold asteroid like you get it on a chain just dragging it behind me no but like how how big is the um how much is it worth like there's a gold asteroid floating around up there uh well i think the stats were that it's got like 10 times more gold on it than we've ever mined it's massive yeah so if we get our hands on that then this is going to be worth like yeah but i think i think the logistics of mining asteroids is pretty out there you're talking about getting off planet maybe we'll see a ship to mars but you know floating around digging on asteroids like armageddon star bruce willis i think we're good that's i mean this guy what's his name rich branson was it they all went up to space with the celebrities recently just for like a photo a photo went up to space apparently katie perry she kissed the ground when she got down yeah exactly allegedly they went up i don't know if it's true or not but i mean if you're oh god i I mean, I love every conspiracy theory out there.

42:26The moon landing. The moon landing's fake as well. No, no. This one I thought might be fake. Because, I mean, they came down, the door wasn't hot, and then they opened the door, and then they closed it, and then they opened it again to try and catch it on. I don't know. But anyway, if you can get up there to space just to, like, have a little photo op, I mean, you might as well go up there and go find this asteroid and get all the gold off it, right? Well, no, just that. You don't need to send people up. Now that you've got AI. AI, send a little robot up there. With AI, which is embodied, if you had a robot that was sentient, you just send them out.

42:51and they can take their time, they can send it back. So, you know, there are lots of different ways you could mine it. But I think AI would probably be the way to do it. It doesn't put people's lives at risk and it's lower cost. I think about the way we mine gold now. We had Ed Conway there, you know, the Sky Economist, and he's written an amazing book, one of my favourite books. Me too, I love it. Yeah, did I tell you to read it? Let's say we did. I don't think so. I told you to read it. Okay. Anyone who's read that book is because of me. It's an amazing book. Yeah. the audiobook's really good as well it just makes you see the world in a completely different way and the process by which we mine rocks today would be so alien to our ancestors even a couple of hundred years ago that they the gold we get out the ground through blowing up mountains and sifting them they would probably be like oh we're never going to be able to get that gold so it is conceivable that we find ways to get more gold isn't it you know in that sense but i don't know we get more gold now than we did then but the price hasn't dropped so what's going on do you understand what i mean we've got better at getting it but yet the price is still going up but we haven't got enough of it to swamp the market i think that's the point the rate at which they can mine it you know it's faster than in the past but it's still not enough compared to say an asteroid which would produce a huge amount or power plants that would generate this stuff you know as a side product as a waste product yeah that'd be amazing it's like the beer industry in burton the waste product is yeast and the marmite factory sucks it all up and turns it into that devil sweat that people spread on toes ringed out of the jockstrap of satan that's that's oh god yeah it's like what is it black tar on toast it's horrible but i like a twig lip so So, you know, riddle me that.

44:39It's like the waste product of oil, I think, is like Vaseline. And then they didn't know what to do with Vaseline. They said, I know, you can put it on your lips. And so that stuff in the tub, they scrape it off the sides of the vats or something. It's like a waste product, Vaseline. They're like, what can we use? Oh, let's sell it. People should stop spreading oil on their lips. I feel like it's a false economy. It dries your lips out more. And they need it more. So, yeah. I don't use Vaseline. Burst Bees. Burst Bees is quality. Yeah, I bought Burt's Bees because you told me about it last time I was here.

45:09There you go. Reading a book on Burt's Bees. It wasn't a book. But yeah, the Burt's Bees. Did you like the Burt's Bees? Burt's Bees is very good. It's amazing. Game changer. Yeah, yeah. Burt is a real guy. Really? Yeah, yeah. It's not just a branding thing. Burt was a guy. I listened to, you know, NPR's How I Made It. Yeah, I listened to it on there. I think it's a pretty ruthless story about his, like, partner at the time. He was a bit of a hippie guy and then his partner, kind of like Ray Kroc McDonald style. You know, he just wanted to have his bees and he got shafted. I don't know. He exploited the bees.

45:40Yeah, yeah, yeah, yeah. They're milking all them bees for that lip balm. He's like, no, get me more. Get back to work. Yeah. Anyway, gold. Who do you think should be buying gold? Do you think anyone should be? Is it a must-have in a portfolio? I think no. And I think for someone who's just starting out with investing, you know, the one fund approach, the bond equity split or the money market fund equity split is probably all you need. Because you can dial the risk up and down. You've got your return. That's everything that you really need to control. And the good returns that you get with equity are what you should be focusing on.

46:15But in retirement, think of it this way. If there's a crash, you have gone from putting money in when you could be making use of the crashes to taking money out. when if you're 100 % equity just to take an extreme case, let's say you're taking out 5 % every year, the size of the pot halves because it's 100 % equity and that could happen. Now you're taking out twice the percentage every year to live. So that's why the compression is dangerous and that's why you have to diversify. So if you had gold in there alongside equity, then the gold won't have crashed. You could sell the gold instead of the equity, give equity time to recover.

46:55so how would you choose which things to buy which wouldn't crash well you choose as many as possible gold is one of them maybe a commodity fund would be another money market fund would be another a guilt ladder where you buy uk government bonds that would be another you know all of these things would give you alternatives in an equity market crash to live off and eat and sell while equity recovers. So you don't milk your portfolio too much and shorten its life too much. So I think post-retirement, there's a fairly good case to be made for gold. Now, some people buy it in the accumulation phase, like you two.

47:34You get these portfolios like Golden Butterfly, where a fifth of it is in gold. And it backtests very well. So some people do, but I don't think it's an absolute necessity. And when you're saying they backtest very well, what do you mean by that in terms of what what are the results that it produces so in terms of the returns it produces because and i think this is primarily because during the crash periods it doesn't crash as much the return of the individual assets isn't as high but when you get the crashes the recovery times faster because it didn't fall so much so that's why is it the risk adjusted return point again that it delivers a better risk adjusted return that's exactly it you look at the risk adjusted of return units of return divided by units of risk so that's on a risk adjusted basis you could make a case for including some gold even in the accumulation phase yeah and would that be for people then that are saying i want i want to invest i want to do okay but i don't want to see the value of my investments drop by a lot because that's going to scare me off so you can improve the risk adjusted return a smoother ride but the end destination would likely be lower than if you just had the equity position which is like the full throttle version yeah i mean psychologically the benefit of that is that you don't see the crashes and for many people they don't like the crashes you know if you're used to it psychologically you kind of love them don't you when you get used to it off you become alive then it's fine but for some people seeing that 20 30 percent fall they don't sleep at night i know that because i speak to them they tell me i just couldn't even imagine that.

49:06So for those people, this would make more sense. It would be more psychologically tuned to the way they approach investing. And I think for certain people, that would be a benefit. So Ramin, definitively, do you think gold is a good investment? I don't think it's an absolute necessity. So if we look at portfolios, and I don't see gold, will I panic? No. Whereas if I see no safe assets, and the person's got a nervous disposition, and that would worry me. But, you know, as part of a portfolio, a diversified portfolio, certainly in retirement, I think it's got a place. Yeah. What are you saying to the people that are sitting here screaming at the screen now or on audio in their cars or on the toilet or whatever?

49:49Gold is money. This is a comment I get. Like the gold is real money. The money we have is not money. You know, it's value. It's all of this. It's thousands of years old. it will be here for thousands of more years try paying your taxes in gold not going to work so if you buy sovereigns in the uk or britannia's uh those are treated like because they've got the got the king's face on them and they've got an amount but they're worth more than the printed amount on them probably right probably but the difficulty there is if you buy physical gold which is that if you have to sell it it's often quite expensive to sell there's a big bid offer spread and the other problem i guess is going to be storing because some people physically store it my dad did when he bought gold he hid it somewhere in the house he did an unbelievably good gold trade you remember when it surged up to the 80s 1980 he bought some in the 75 i think it was wow hid it in the house didn't tell me where it was and that really annoyed young ramen because i looked everywhere for it where's the house yeah it'll be like that guy with the treasure in the you know in the in america no he sold it at exactly the right time just before he did sell the gold just before that bubble popped in 1980 so he timed it perfectly buying gold at the time when they were saying the dollar is no longer pegged to it feels like quite a risky thing you know they're basically rewriting the rules at that point of of the monetary the monetary system and your dad was like yes let's let's buy a bit of the gold well he was an economist he had lots of really crazy ideas but sometimes he was very right you know he made a lot of money in business so you know obviously he knew his stuff but i wish he told me what it was you think did he know about you becoming a youtuber and doing what you do today no sadly that happened after he died but i think he'd be very proud i think he'd be pleased yeah yeah obviously he knew your work within the finance sector yeah but uh when i was a scientist he wasn't really into that he didn't think that That was a kind of valid career choice.

51:54What kind of science? Science, yeah. Pish. Who needs science? Do something serious with your life. What kind of scientist were you? So I did a degree in physics. I got a first in physics. And then I did a PhD in physics, biophysics. So I was looking at anesthetic mechanisms and how our brain reacts to anesthetics. That was really interesting. And then for postdoc, I did modeling of how children learn language. So it was neural networks. so all this stuff about deep learning neural nets you know that was the kind of stuff we were doing so it's kind of given me an insight you're pretty well positioned you know it's just a good positioning to understand the world i'd say right now you know that stuff about the fusion reactors you know that was obviously i was gonna say you could be making some gold building an building an ai rocket to get us up to the asteroid to get some gold i still think we should do the heist do that we'll talk about it off camera yeah yeah do you think that gold's the best commodity or do you think there's a better commodity than gold out there oh that's an interesting question i mean i like i like the fact that you can buy it without physically buying it you know i think these etfs give you a lot of choice so you know which commodity do i like best i'd say i'd probably go for the kind of energy ones because they're more useful copper i think is very interesting right now because there's huge demand for it if it becomes expensive you can't swap out copper for an alternative because it's got such low conductivity it has all these properties which no other metal has and with the transition to renewable energy there's such big demand for it all these offshore wind farms you have to pipe the energy back on shore electric vehicles use huge amounts of it actually just built into the car so huge demand limited supply and i've got a copper portfolio which i did via copper miners but you can buy copper funds so probably i'd say copper would be would be my favorite at the moment gold is not an alternative is gold not an alternative to copper i'm not saying that copper is ever going to get that price but you say copper's got characteristics that no other metal has does got is when you look at price so presumably that cheap Exactly.

54:04Yeah, for that price. But the conductivity of copper is very low. Sorry, the conductivity of copper is very high. The resistivity is low. So it's relatively cheap. It's like a poor man's gold in that sense then. If you could use gold, you would if it was cheap enough. Yeah, I suppose so. But yeah, copper, I think, is going to have big demand in the future. And it's a useful metal, whereas gold, not so much. How many portfolios do you have? I've got loads in my fund portfolio. Yeah, obviously, you've got your portfolio. Oh, my core is one fund. Yeah, but then you've got all these little tests that you're running all over the place.

54:37But that's why trading 312 is great, because you can have these pies and you can have zillions of little experiments. Some of them is like literally 100 quid, but the core, 90 % of it, one fund. You know, very simple. It's just you come and you constantly drop, oh, I've got a little copper experiment and this and that. Oh, yeah, that's what's great about the kind of ability to create little pies. So that period of time where we came off the gold standard, gold has this track record of thousands of years. we've obsessed about it as a form of exchange and currency for as long as basically human civilization.

55:09At that moment, we delinked that relationship. Did gold change then? Did the narrative around it change? And should we only really view performance beyond that point? I'd say a little bit beyond that point because you're never going to come off a gold standard again, right? And that period of price discovery, when the price surged unbelievably, I don't think that's going to be reproduced. So I'd argue, yeah. Mid-80s. Yeah. And you would say that the only returns that matter for gold are from the mid-80s because we changed the game. Could we ever go back onto the gold standard? No. Because economically, it's just crazy.

55:49If you imagine that you've got an economy where the amount of money has to keep in line with the size of the economy, if that money's linked to the amount of gold you've got in your reserves, then you have to increase the amount in the reserves in line with the economy and you just wouldn't have enough gold. You'd run out of gold. It's just stupid. Unless we start mining asteroids. Yeah, but then it kind of makes the gold value go down so you can even need more gold. So do you think people who have brought up the argument of gold has delivered X, Y, Z against inflation for hundreds, thousands of years they're failing to recognise that at that point we changed the game and is it a different kind of asset now beyond that?

56:30After losing the gold standard? Yeah, after losing the gold standard, after no longer linking it to money in that sense. I think psychologically there's this remnant which looks back to that period where people still see gold as very safe. I mean, central banks do it, right? So that's what we're seeing right now, lots of central banks buying it. I think the problem is that you do get these changes in supply and that would radically change the value of gold. So if we did get the asteroid, if we got the ability to manufacture gold from other materials, other elements. Again, that would fundamentally change the game.

57:02And people just don't price that in. Do you think central banks are wrong with their view of gold then? I think they're right in the sense that it's a safe asset. What else would they buy? That's the difficulty they face. They can store and keep and everyone agrees that it has some value internationally. Because it's, yeah. If you imagine you're a central banker, think about it, right? So you've got this huge wad of cash, which you're looking after for your country. I mean, it is like playing for England. You know, it's not glorified in that way, but that's what they do. They keep the national treasure.

57:35What would you do with it? You know, would you put it into Bitcoin? I don't think so. But you know, what are you going to invest in? It's not easy to do. yeah because you need it to be internationally valued you need the chinese to say yeah we recognize the value of that thing in your vault otherwise you might as well just store you know local art and people be like well we don't really value that cornish pasties yeah we've got a stuck pile of cornish pasties greg sausage rolls or something and when the world's falling apart it's got to keep its value and that's what gold has been really good for historically and i think that's not going to go away soon.

58:12So you think for central banks, they have no other option. What else can they buy? Could they not buy equities? Some do. And in fact, some of the sovereign wealth funds almost. Well, some of them almost become like that. So I know for a fact that some of the central banks have been doing that. But the problem always is the volatility. If you've got something which is crashy, then presumably, if there's a market downturn and there's a crisis where you need the gold or the reserves. If it's an equity, then it would have crashed, whereas gold wouldn't. What about the tax argument? So we spoke about the coins before, and I know that because they're legal tender, they'll be free of tax on the gains.

58:55Do you think that's incredible? Do you think that makes the gold argument a better investment if you're buying these coins? I mean, certainly some of our community do that. We had this funny chat from someone who said, yeah i bought some uh but he was saying he stored it in a you know in a safe in his house you know i thought that's pretty brave of them but the question is always about storage about selling liquidity who do you sell it to you know what's the price you get you know if you buy an etf you're going to get very good pricing very competitive bid offer spreads institutional level bid offer spreads whereas if you're selling to some you know gold yeah we buy gold.com yeah yeah yeah they're going to scalp you they pay fees on both sides yeah so that's what keeps me away from it that's why i'd go for what what gold bugs call paper gold which is etfs which give you that exposure for me it's just simpler yeah i liken it sometimes to it's different but people when they talk about rolex watches like oh they're a great investment blah blah blah when are you ever going to sell it look when is the moment that you sell that watch we've got a couple of them but yeah if you got one you're not selling people people hold a lot of sentimental value and they like to look at it and polish it and you know and then i just don't i can't think of the day where they go i'm selling it unless you know they're desperate um and you know they get they get rinsed on the price because they're desperate that they need to sell it quick and you know anyone i know who's ever sold a rolex is going bad times you know they're never selling it in the good times obviously if you're a dealer or a trader of rolexes there may be but gold seems a bit like that to me, that people like having it and keeping it and having it and looking at it.

1:00:36When is the point that they're going to go, okay, I'm going to get rid of all this thing now that I've collected over years? It's funny. I mean, when I look at my portfolio and I think about the wealth I've accumulated over time, it is very abstract. It is just a spreadsheet. And it's hard to think of it in concrete terms. Whereas if you actually have one of these Britannians in your hand... I bought that in 1974 and you have a sentimental value and it does look nice and you can show it to your family say look you know this is what we worked for so i can see why people do it they feel nice don't they yeah they're like heavy and not like your tin jewelry all right mister i've got a bead on my wrist yes heavier than all yours heavier than all yours yeah okay so what final final question then if someone wants to buy gold what do you think is the best way for them to add that to their portfolio i'd say first of all don't buy too much you know don't kind of go overboard with the percentage that you buy so 10 percent you know 20 percent at a push um is the kind of levels that people buy if you are going to go for it there are many cheap funds which give you exposure to it now so you won't be paying more than about 0.15 percent i think is the cheapest for the uk investor so just look at the expense ratio because gold is gold right there's not much to choose between one fund and another Physical exposure is what people usually go to.

1:01:53Read the fine print, look where the vault is, because if you care, I care, I certainly do, then it's certainly an important factor. But nowadays you can get that exposure very cheaply with these ETFs, so that's probably the way I'd go. People can be confident of the value of their money and the gold there. These places are insured. Have they got all of that kind of stuff? You're saying, I care where the gold is. you know the chance of a gold vault being robbed are very low i'd say more likely for a bank to get robbed i'm guessing yeah i'd say so and probably they're insured i'm not sure about the insurance maybe i should have looked that up as well it should be insured because uh wine investment wine is insured so it's a bit different when it's like billions of pounds and it's insuring that and what's the cost but i suspect if you had bulk quantities then it wouldn't be you know the insurance wouldn't be that high but you are the ultimate beneficiary of the of owner you get the kind of legal ownership of the gold if you have the etf so i wouldn't be that worried about can you go there and demand it can you say give me my gold no and if you've got gold in your house in a safe or you've got some coins where would you store that yeah where do i keep my gold no safe deposit but are you thinking more safe deposit box than you are it's funny because i heard a story about someone that actually buried it in their garden you know which is difficult because what if you forget what if you die and you don't tell your family like my father didn't tell me where the gold is hidden you know that could be a problem and that's why we have hoards right you still find them today where people buried their treasures yeah yeah you don't want to have that kind of hoard scenario i use that as an example of how because one argument of gold is if society collapses, you've got your gold.

1:03:36And I use that as an example of a bad example of, well, it clearly didn't work. They buried it and something happened to them and they never came back. And someone said, yeah, but what about all the ones that did work and they did dig them up? And I was like, yeah, okay, fair enough. You know, maybe they just had a bad time, that one Roman family, but it was probably quite commonplace, wasn't it? But look, if you go to store it, store it securely and don't tell people about it. Because if you do, then stories spread and then... Just like your dad. Didn't, you know, your son didn't even trust you to tell you where the gold was.

1:04:07Yeah. Well, thank you so much again for your time, mate, and for coming on. That's your third episode now. Hat trick. We'll get you back. We're going to go all the way to 10. And we'll do a celebration. Thank you so much. No, no. Our pleasure.

1:04:22Before you go, it's really important to remember that nothing we said there was financial advice. The reason it's not financial advice is because it's not tailored to you. If you want advice that's tailored to you, it's worth speaking to a financial advisor. As with everything financial, please do your own research. We really encourage that because no one cares more about your money than you. I'm Damo. I'm T. Jack and Ben from Flowspire, film and edit for us. Ruth's our producer, and Will is the co-founder at most. See you next week.