I strongly believe that everyone should own some physical gold. It's been the store of value, and the preferred method of asset protection for more than 5,000 years. It's irreplaceable.
But I also believe that every investor ought to own at least some of the new digital money known as bitcoin.
You see, most of the people buying bitcoin are interested in the explosive growth potential the new "currency" offers, as more and more retailers, CEOs, and governments embrace it.
But they're getting more than that.
Bitcoin comes with some unique wealth preservation properties, too. And while it will never replace the market's most popular hedge, it does have five distinct advantages over gold…
No. 1: The Supply Is Absolutely Fixed
A lot of investors look on gold as a store of wealth because of the precious metal's limited supply.
Actually, that's really only true in the short term. Yes, there are only so many mines operating at any point in time, so the immediate supply remains fixed on any given day.
However, exploration teams are scouring the planet and finding new gold reserves all the time. When the price of gold rises, those new tracts become more economical, meaning the supply of gold can in fact expand.
It's the exact opposite with bitcoin. They are created when someone discovers a new mining block on the global computer network. The number of blocks is capped at 6 per hour.
Moreover, bitcoins generated per block decrease geometrically, falling 50% every 4 years. The number of bitcoins mined will never exceed 21 million by the year 2140.
Roughly 57% of the total maximum have already been mined…
No. 2: This Is a Real Currency
It began when President Roosevelt confiscated America's gold during the Great Depression. And when President Nixon took the United States off the last vestiges of the gold standard in the early 1970s, the metal's days as a true currency were over.
Sure, you can still buy gold coins, but just try using them to pay for something at Walmart or the local convenience store. People will look at you like you're crazy.
But in the United States alone, more than 700,000 retail outlets accept bitcoin, including chains like 7-11 and Wal-Mart. And in France, workers can choose to have their salaries paid in this new digital currency.
In fact, bitcoin is already recognized around the world as a medium of exchange and is traded in roughly 90 different markets from Toronto to Singapore every single day.
No. 3: Central Banks Can't Manipulate the Price
Paul Craig Roberts can't afford to make baseless charges. A noted economist, Roberts served as Assistant Secretary of the Treasury during the Reagan administration and is a former editor of the Wall Street Journal.
So, were he to make a wild accusation, that would undermine his credibility as a market analyst and possibly ruin his career.
But Roberts is adamant that a big part of the recent rout in both gold and silver prices is a direct result of central-bank manipulation. Roberts believes the Fed led a coalition of mega-banks that sold off gold reserves and certificates to support the dollar in an era of mega-printing.
About the Author
Michael A. Robinson is one of the top financial analysts working today. His book "Overdrawn: The Bailout of American Savings" was a prescient look at the anatomy of the nation's S&L crisis, long before the word "bailout" became part of our daily lexicon. He's a Pulitzer Prize-nominated writer and reporter, lauded by the Columbia Journalism Review for his aggressive style. His 30-year track record as a leading tech analyst has garnered him rave reviews, too. Today he is the editor of the monthly tech investing newsletter Nova-X Report as well as Radical Technology Profits, where he covers truly radical technologies – ones that have the power to sweep across the globe and change the very fabric of our lives – and profit opportunities they give rise to. He also explores "what's next" in the tech investing world at Strategic Tech Investor.