Even though I spent most of my working life in the securities industry, I was only a broker for a short time back in 1987. I was just not good at handling clients. Bad at sales. Good at trading.

So when I saw Mebane Faber’s post yesterday, it immediately brought back memories:

A Simple Post on Gold
This is going to be the most subjective and least quantitative post out of the 500 odd posts I have written. I am not a gold bug, and while I have written that gold shares are attractive relative to gold in the past, I don’t see a lot of strategic value of gold to a portfolio (tactical, yes).

The most important thing I learned from observing clients is that hell hath no fury like a client not on board an uptrend. You can lose money. You can be wrong. But if you don’t have them on board the hot momo thing, boy, you are in the dog house.

And so it is many advisers probably find themselves “not long” gold. They’re not in it because as a trading vehicle, the diabolical price action is extremely difficult to master. Because the yellow metal provides no dividends and costs money to store, it doesn’t have any redeeming qualities desirable in a long-term portfolio.

In normal times, gold is leech, but with yields near zero, it looks more attractive, not to mention that it is a way to diversify currency as an asset class. That’s why we added gold to the Satellite portfolio last November.