I know people out there who have invested a lot in gold under the belief that in the event of like complete societal collapse or hyperinflation, they could use it for purchasing.
I have the hunch it’s a scam, but I haven’t learned enough monetary theory, business, or economics to understand why.
Gold is only as valuable as people deem it to be. It’s a solid investment because it doesn’t suffer from things like inflation or short sellers. Gold is like a treasury bill in that you’re not going to make a bunch of money short term, but you can be relatively sure you won’t lose you investment long term. I heard something about a decade ago which still holds true: as long ago as the Roman empire, an ounce of gold was worth enough money to get you a top quality outfit including top quality sandals (shoes) and still leave enough for you to get a top quality meal. Will you get those things with gold in an apocalyptic situation? Nah, but assuming human civilization continues to survive, you can expect the value of gold relative to products and services to stay strong while currencies lose value.
You can short gold ETFs. Gold is highly speculative and has crashed taking decades to recover (~1980-2005). It’s basically boomer-bitcoin.
you can short EFT’s but shorting the metal itself is a different thing. As an element that has real world uses the market drives t he value.
Oh thank the abacus gods I’m not the only one doing that
It pretty much is the same thing. In theory, shorting the ETF will drive the price of gold down (until the short needs to be covered; like all shorts), because all accounts must eventually be settled. The price of gold is literally set by the futures market, which people with the appropriate approval can also short. Gold dealers literally look up the price on the futures market and add/subtract a few percentage points to determine how much to buy/sell physical gold for.