What could be termed the moral imperative of investing in precious metals should not be underestimated, especially as part of the social movement wildcard that could draw many people to an asset like silver. However, it is worth pointing out how this kind of determined effort to take a stand for hard money has led some to famously quip that, as someone once said, “gold is not an investment, it’s a religion.”
This accusation goes back quite a long way, actually. The first negative use of the term goldbug likely started in the Election of 1896, as a way of criticizing the supporters of William McKinley who defended the gold standard. But the term first entered English via Edgar Allen Poe’s short story, The Gold-bug, published in 1843. In the story, Poe relates the account of a man, Le Grand, who was bitten by a bug made of gold. The bite gives Le Grand supernatural power- clairvoyance really- to find the long-lost treasure of Captain Kidd (deposited somewhere along the southeast coast of the United States) in order to restore the Le Grand family fortune. At the end of the story, Poe has Le Grand relate to his friend that the power of the Goldbug was not what led to the treasure, but rather Le Grand’s own reasoning powers, or ratiocination. But in keeping with Poe’s usual portrayals of the mystical and terrific in his stories of ratiocination (meaning one’s ability to reason in a superhuman manner) the reader is left wondering if it wasn’t in fact the transcendent knowledge of the Goldbug which aided Le Grand after all. A large part of Poe’s writing leaves room for intuition and magical insight, implying that these are as much a part of reason and intelligence as anything else. This is an important point to keep in mind the next time someone derides gold and silver investing as a “religion.”
Religion can mean many things—I simply take it to mean a belief in supernatural truths, or truths that are beyond this man-made world. I think that each day, more and more people are realizing some of these basic truths.
Here are some of what I would call the Ten Commandments of the gold (and silver) bugs:
1) Thou shalt not live beyond one’s means.
2) Thou shall remember that if something sounds too good to be true, it is.
3) Thou shalt not rely solely on pushing paper wealth around for a living.
4) Thou shalt not place too much faith in politicians.
5) Thou shall honor the idea that resources cannot be conjured out of thin air.
6) Thou shall remember not to believe everything you hear, read, or even see.
7) Thou shall remember that what is given by the government can be taken away.
8 Thou shall take responsibility for your own financial wellbeing.
9) Thou shalt not steal from savers.
10) Thou shall remember how scientists, economists or other man made experts are not God.
These tenets are laid down only partially in jest. I really do think that as more people throw up their hands in frustration at the current financial system (and possibly at their role in aiding and abetting that system) people may also decide to reach for gold and silver. Not to make a killing, but to speak truth to power.
Only time will tell.