Checking Up on Gold

Charles Dickens is credited with coining the phrase, as good as gold, but how good is gold really? Hi, I'm Rob West.

Inflation and several bank failures have a lot of folks thinking about buying gold and other precious metals these days. Mark Biller joins us today to give us his point of view. Then, of course, we'll take your calls at 800-525-7000.

That's 800-525-7000. This is Faith and Finance Live, biblical wisdom for your financial decisions. Well, the inimitable Mark Biller is executive editor at Soundmind Investing and underwriter of this program.

You know, folks have tried to imitate him, but so far unsuccessful. Mark, welcome back. Well, that is quite an intro. Thanks, Rob. I'm glad to be back.

We're delighted to have you. Hey, by the way, we are going to be taking your calls today on investing, but specifically in this earlier portion of the broadcast, we'd love to hear your questions related to gold and precious metals. Mark Biller will be answering those as we work our way through this topic today. We're addressing the latest issue that was featured in the Soundmind Investing newsletter where they take a deep dive on gold. And by the way, you can head to soundmindinvesting.org and read the article. It's titled Checking Up on Gold. But Mark, as we kick this off, why don't you set the stage by explaining why a lot of gold watchers expected gold prices to be halfway to the moon by now and why that hasn't happened.

Yeah, absolutely, Rob. So when investors think about gold and what moves its price, there are a handful of things that usually jump out to them. Inflation is a big one, government spending, wars and other types of fear episodes, those types of things usually come to mind. When we think back over the last three years, you know, what have we had? Well, we started with a global pandemic and all the fear that went along with that. Then we had massive monetary and fiscal stimulus in response, which led to the biggest inflation spike we've seen in 40 years.

And then after that, we had a major war break out in Europe. Since then, we've, of course, had tons more government spending, big deficits, lots of market uncertainty. The point of all this is that when you look at all these factors, it would seem like this would have been the perfect storm to drive gold's price to the moon, like you said.

But that really hasn't happened. You know, gold peaked in August of 2020 at around $2,070 per ounce. It then fell by about 20% and last November was trading just a little bit over $1,600 an ounce. Now, we have seen a good bounce from that level back towards the $2,000 level today. But the point that I'm trying to make is that gold is actually cheaper today than it was in the summer of 2020, despite all these things that have happened since then. Wow. Yeah, that has definitely perplexed many people.

So, Mark, what do you attribute this to? Yeah, well, one of the main points that we make in the article is gold isn't just one thing. And what I mean by that is, you know, gold is an inflation hedge, but it's not just an inflation hedge.

It is a hedge against war and other fear episodes, but it isn't just that either. Gold responds to a lot of different things, which is partly why it can be so confusing and disappointing sometimes for investors, especially if they're focused on one of these things. So, ironically, the one factor that really probably correlates the best to gold's performance is one that most people don't even think about, and that's interest rates. And if you think back the past few years, it really makes a little more sense what gold's been doing in light of interest rates. If we go back to the summer of 2020, interest rates were rock bottom levels. The Fed funds rate was less than a quarter of 1%. Well, since then, we've seen that Fed funds rate get hiked over 10 times.

It's now close to 5.5%. And that really has, that big move higher in interest rates has really kept a lid on gold prices and kept them from soaring the way people would think. So one of the points we make in the article is we're actually pleasantly surprised gold has held up as well as it has.

Relative to interest rates, we might think it would be a good bit lower. Interesting. Well, we're going to continue to unpack this. Where is gold headed from here, perhaps, and how should you own gold?

ETF, mutual fund, or physical gold? That and your questions just around the corner. Mark Biller with us today. Lines are open for your precious metal questions and investing-related topics. 800-525-7000.

Again, that's 800-525-7000. We'll be back with much more just around the corner. Stick around. Well, it's great to have you with us today on Faith and Finance Live. I'm Rob West, your host.

With me today, my good friend Mark Biller. He's executive editor at Sound Mind Investing. You can learn more at soundmindinvesting.org. While you're there, check out this article we're talking about today called Checking Up on Gold. You know, with all of the fear and uncertainty out there, a looming recession, all the marketing going on related to gold products right now, you might expect that gold is up nicely. In what Mark shared just before the break is, you may be surprised to know that gold is actually cheaper today than it was in the summer of 2020.

And Mark shared some of the reasons behind that. We'll continue to unpack that and talk about much more related to how you should think about investing in gold and a proper allocation, plus an outlook on gold as well. We're also taking your calls and questions today in this portion of the broadcast specifically related to investing. And if you'd like to talk about maybe your own gold allocation or what you're considering related to the precious metals, we'd love to chat with you about that. The number to call is 800-525-7000. We've got some lines open. Mark Biller here to answer your investing related questions.

Again, 800-525-7000 you can call right now. Mark, before the break, you were talking about, among other things, that interest rates are one of the key drivers of the price of gold. Share with us a bit more as to why that is. Yeah, so the simplest way to think about it, Rob, is just to recognize that gold doesn't pay investors any type of yield, whereas most other safety assets do. So the types of things that typically compete with gold for investor attention and money would be things like savings accounts, bonds, other traditionally safe places to park money. All of those things have been offering higher and higher yields over the last couple years, certainly the last year, as interest rates have risen so much. And that makes those assets more attractive relative to gold, which doesn't pay any type of yield. So as a result of that, when you look back over history, you usually see gold moving up and down in response to rates that will usually do well when interest rates are falling, and then gold struggles when interest rates are rising, which they certainly have been lately. Yeah, really helpful, Mark, and I think that helps to explain why we've seen the action that we've had.

Well, that's a great overview. Now, how do you at SMI recommend that investors typically approach owning gold and other precious metals? There's, of course, a difference between owning the physical gold and then trading gold, if you will, through mutual funds and ETFs, right?

Yeah, there certainly is, and they both have pros and cons. So owning the physical metal has a lot of advantages. You've got it right there in your hands, which is what most people really want when they're investing in gold.

If things ever get really bad, you don't have to worry about a counterparty. And what I mean by that is like a bank or a company behind a mutual fund or an ETF making good on the gold claims that you have through a fund or through an ETF. So there's a lot to like about owning your physical gold directly. But owning physical metals also has some downsides.

Cost is a big one. Buying and selling physical metals is very expensive. Makes it very difficult for most people to do any kind of a regular dollar cost averaging type of program or making frequent trades, purchases, and sales of physical metals is pretty unwieldy. And the other thing that a lot of people don't think about is beyond a fairly small allocation of a portfolio, you really have to think carefully about storing physical metals. You don't really want to have a huge pile of physical gold in your house or things like that. And so you can get into some downsides there with the physical metals as the amount increases. So what we do at SMI is we break it down this way. We typically think that having a small allocation of physical gold is a great idea.

If people want to do that, that's wonderful. But we tend to encourage our folks to think about that as being kind of a forever allocation. This isn't something you're going to buy it today, hope it goes up, and then sell it a year or two from now because really the costs of getting in and out are so high. So we would hope that that would be gold that maybe they keep and give to their kids or their heirs or something like that. And that kind of takes the transaction costs out of the picture. When you look at it that way, for most people, their physical gold allocation is probably going to top out maybe in the 5% range because above that it's just starting to become an unwieldy amount. But then on top of that kind of physical forever gold allocation, that's where we at SMI will use the gold ETFs to kind of supplement that allocation. And we do that more as we feel like the conditions warrant. So these ETFs, you can trade them just like a stock or any other mutual fund through your brokerage account. So they're very easy to buy and sell. We have a particular SMI strategy that gives us signals when we want to increase our allocation to gold or bring that back down.

So if you put these two ideas together, most of our SMI members have a small constant allocation to physical gold that they keep and then they have a variable allocation of these gold ETFs that goes up and down as gold moves in and out of favor over time. Yeah, that's really helpful. I want to drill down on that counterparty risk in just a moment, but let's take a question before we head to our next break. Linda's in Michigan. Linda, go right ahead. Yes, I have a question.

If one does not have the funds to invest in gold, do you think that silver coins would be a good option? Yeah, Mark? Yeah, they certainly can be, Linda. You know, they're clearly linked. People think about those together. I tend to think about precious metals this way. I think of gold and particularly physical gold being in one camp and then all of the other metals and options kind of being in another camp. And the reason I think about it that way is the other metals, including silver, are going to trade a lot more based on economic conditions. One thing with silver specifically is there's a lot of silver being used in solar panels. And so that's a good example of like the economic conditions moving the supply and demand and the need for silver in the economy. And that's just different from how gold trades as a monetary metal. And so you just want to be aware that they're kind of different and that silver is going to move up and down on a little bit different criteria maybe than gold is.

They're going to be related, but not exactly the same. Silver tends to be a little bit more like the hyperactive little brother of gold. So when gold does well, silver tends to do real well. But sometimes you'll have cases where gold holds up pretty well because of those monetary properties.

And silver can really take a bath because it's really trading more on the economic forecasts and economic conditions. So I'd look at that one, Linda. Yeah, that's really helpful. Linda, thanks for your call today.

Mark, just about 30 seconds. But this could be where she could use these ETFs, right, because as long as it's not her buy and hold forever position with even a small amount of money, she could have an allocation to gold, right? Yeah, that's absolutely right, with a small dollar amount. So that's a great idea.

Yeah, very good. All right, when we come back, we'll talk a bit more about those ETFs. What about the risk that that bank or company may not make good on the gold that they say is backing your investment and Mark's outlook for gold and precious metals? Plus your questions on investing and precious metals at 800-525-7000. We'll be right back. We're thankful to have you with us today on Faith and Finance Live.

I'm Rob West, your host. We're talking today with Mark Biller, executive editor at Soundmind Investing. We're talking specifically about gold. The feature article in the recent Soundmind Investing newsletter was titled, Checking Up on Gold. Mark was the author.

You can read it and take a deep dive into this topic at soundmindinvesting.org. Let's head back to the phones. Daniel is in Elgin, Illinois. Go ahead, Daniel. Yeah, thanks for taking my call. I appreciate the wisdom that's been shared so far. I pretty much have been following the advice where I have an emergency amount of gold just for the same reason I have life insurance, in case things go wrong badly, but it's probably something I'll never use, probably pass it on to my children. But my question on the second level of emergency is, you know, with the level of indebtedness our country is facing, you know, unprecedented and the way things are going politically, economically, not only in the U.S. but in the world, you know, there's talk that someday the U.S. dollar may not be the world's reserve currency.

In fact, we may go to like a Bretton Woods number two where, you know, some currency in the world would be gold-backed. When I look at all that, there's so much uncertainty, so much unknowns. It's very difficult for me to try to figure out how much to allocate to that possibility. I almost kind of like give up on that part of it.

That's my question. Yeah, Mark, a lot to that, but just your general approach to investing in gold, and then these other considerations that Daniel's throwing out there about just the uncertainties in the future. Yeah, absolutely. Daniel, you've touched on a lot of points that a lot of people feel very concerned about and that lead a lot of people to investigate gold. Of course, people who are sellers of gold products and services are quick to highlight all of these potential concerns as well. And, you know, there's no way to say that we shouldn't take these things seriously.

I think we all look at them and it makes us all nervous to varying degrees. I guess what I would just point out along those lines is I like your approach, Daniel, of kind of having that first level of kind of a life insurance type policy with gold. If things ever got really bad, you've got something there that probably is going to hold up really well. The key to thinking about gold, in my opinion, is to recognize that its real use is as a store of value.

And, of course, that's really what we're talking about if we're talking about these more dire circumstances. The problem is that while a store of value is great, most people with their investments, as they're thinking about funding retirement and so forth, they need more than that. It's not enough to just have it tread water and maintain its value. They need something that can actually grow their purchasing power over time. That's why financial professionals, planners will typically steer younger folks towards stocks because those can grow along with the growth of the economy. And so all of that to say simply that you don't want to overallocate to gold, that can be a risk just like not having any exposure can be a risk because there are periods, if you look back at like the 1982 to 2000 period, gold was a terrible investment. It went down in value over a couple decades.

That's a long time to be flat or even behind having lost ground over that time. So we do want to keep in mind the biblical principle of diversification. We want to protect against some of these worst-case scenarios, these fears that we have. But we don't want to overdo that and put all of our eggs in one basket either. As far as how much is appropriate, again, we tend to steer our folks towards a relatively small physical allocation of gold. And then as conditions that are more like the interest rates and things like that that we're talking about at the beginning of the program, as those conditions ebb and flow and we think it's particularly advantageous time to own gold, then we'll take that allocation up on more of an opportunistic basis. Instead of that being a permanent, we're going to put 20% or 25% in gold.

That's just too high for most people because they need that growth in their portfolio. So those are my thoughts there. Rob, what do you think? Yeah, no, I couldn't agree more, Mark.

That was well said and I think just helps Daniel really think about these levels that he's got, which is, again, a great strategy and how that might fit into his long-term investment approach, which does need to solve for the ability to offset his income needs in retirement. Let's see, Englewood, Tennessee. Hi, Mike. Go ahead. Hi, guys.

This is Mike. How are you doing? We're well, thanks.

Good. Listen, I retired back in 2009 from the nuclear power industry, so I get two retirement income checks and I get Social Security and I'm on Medicare, but after a while, I started traveling using my nuclear experience just to make extra money because I was a board. Then I got tired of traveling, so I'm working at a local industry now and I'm in maintenance. They offer a 401K that gives 4% if you invest 6%, so I've done that. Over seven years, I have like $40,000 in that and I've always wanted to own gold, so my question to you all, and I'm doing this 401K just to buy my wife a new car when she turns 70. We're 69 now, but anyway, I have about $40,000 of that and I was thinking about investing half into gold, and my question is, is gold coins or gold bars more valuable?

Yeah, great question. Let's do this, Mike. We want to make sure Mark has enough time to answer your question there and we've got to hit a quick break here, but if you'll stay on the line when we come back, I'll get Mark to weigh in on that. How should you think about this gold exposure you'd like to have in terms of coins, bars, or maybe some other approach? Mark Biller with us today. If you want to read this article we've been talking about checking up on gold, head to soundminedinvesting.org.

We're going to take a quick break when we come back. Much more on this topic. Investing-related questions are what we're taking right now, 800-525-7000. Stick around. Great talking with us today on Faith and Finance Live.

I know you're seeing the ads all over the place. Buy gold. What about a gold IRA? Well, how should you think about gold? We're talking with our good friend Mark Biller today, executive editor at Soundmind Investing.

He's written an article recently called Checking Up on Gold that not only looks at the performance of gold and the outlook of gold, but how you should think about including it in your portfolio, answering a lot of the key questions. You can read it. No subscription required. Just head to soundminedinvesting.org. We're going to go back to the phones here in just a moment and answer Mike's question, but first, here just with two days left, the end of the month, you could help us stay on pace with our listener support goal.

That's right. Faith and Finance Live is listener supported, which means we rely on your gifts to bring you this broadcast each day. And if you'd like to give a gift of any amount, we'd certainly appreciate it. Just head to our website, faithfi.com. That's faithfi.com and just click the give button. Thanks in advance.

All right. Back to the phones. Mike is in Inglewood and he was sharing with us that he has a desire to own gold. He's retired, although he's gone back to work because he got a little bored. He has a retirement plan he's contributing to.

His retirement income needs are covered through Social Security and a couple of retirement checks he gets. But Mark, he was asking about perhaps how he should think about gold. He's thrown out two ideas on either coins or gold bars. Would love your thoughts on that.

Yeah, that's a great question that Mike asked. There are a few different things that I think are helpful to pull out of that question. So first of all, for a lot of listeners who may have money in a 401k that would like to allocate to gold, the best option is probably going to be one of these gold ETFs, especially if they have a brokerage window option in their 401k that allows them to buy whatever mutual funds and ETFs they'd like. That's a great way to keep your money in the 401k and still be able to allocate to gold.

Now, if you're going outside of the 401k, then the coins and bars question is really a good one. And the way to think about that is when you're buying physical gold or silver, any of these precious metals, you want to be thinking about the premium that you're paying over the spot price of the metal. So in other words, if you go online today and see that the price of gold is $1,970 per ounce, well, if you go to buy a gold coin, you're going to pay more than that.

You're going to pay a premium over that spot price. And that premium is going to get bigger as the increment of gold gets smaller. For example, you might pay, I'm just going to make up this number, but you might pay $2,000 for a one-ounce gold coin, whereas you would pay considerably more than that for two half-ounce gold coins. Same amount of gold, but the smaller increment is going to increase that premium. So when we talk about gold coins versus gold bars, not only are the smaller gold coins going to cost you more than the bigger gold coins, it's kind of a scale that continues as we move from coins to bars. So the big advantage of buying the gold bar would be that instead of buying a one-ounce gold coin, if you're buying a 10-ounce gold bar, it's going to cost you substantially less of a premium, a markup over that spot price. So that's really the only big difference in terms of coins versus bars. I would also just recommend, though, for people to think, you know, laying it out that way would make it seem like, well, you'd always want to buy the biggest increment that you can to keep the cost down. The problem with that is for a lot of people, the purpose that they're buying the gold or the silver for is ultimately if there's an emergency and they had to actually transact with that physical metal, then you don't want to own one big gold bar. You would want to have the smaller increment. So you kind of have opposing goals here.

But those are good things to keep in mind as you're buying because you can compare one shop or one dealer against another in terms of these premiums and look around to try and get a good deal. That's really helpful. Mike, thanks for your call today. Jeff's been waiting patiently in Indiana. We're going to go there next. But first, Mark, you were sharing earlier in another broadcast we were on together about a junk bag of, let's say, silver, speaking to this question about those wanting to solve for the ability to transact in the event of some sort of catastrophic event.

Explain what that is. Yeah, so junk silver is a term that's used for U.S. dimes, quarters and half dollars that were issued prior to 1965. Before 1965, those particular coins actually had real silver in them.

The ones since 1965 no longer do. So what dealers will do is they will actually sell bags of those particular types of coins by weight. And because of the fixed ratio of silver in those coins, a particular junk bag of silver or a bag of junk silver of a particular weight, you know how much actual silver content is in that bag. So it's easy to buy and sell that way. The advantage of those junk bags is you've got a ton of these little incremental pieces of silver in that junk bag, lots of dimes, lots of quarters, that kind of thing. So if things ever really did go horribly badly and we were resorting to transacting in silver, that's a really convenient way to have a certain amount that's easy to buy and sell but that would give you a lot of divisibility that you could make a lot of little purchases with.

So a lot of people like junk silver, these bags that dealers will sell, as a solution for that, well, what if in a really bad situation I needed to transact in precious metals? Yeah, very good. That's really helpful. All right, to Anderson. Jeff, you've been incredibly patient.

Go ahead, sir. Hi, I'm getting ready to sell a house in Ohio and I'm going to profit about $100,000 off of the sale of that house. And I was wanting to invest in gold and my question is, out of that $100,000, how much should I invest in gold? Yeah, what other investable assets do you have, Jeff? Well, I have a PSP, a personal savings plan at work, and it has about $100,000 in it right now. I'm close to retirement, about four more years, and I just want to make an investment to help me with my retirement. Yeah, so you've got $100,000 in the PSP and then other than the proceeds of this home sale, anything else in investable assets? Not at the moment, but I was also looking at investing in an IRA also or maybe a gold IRA or something like that. Okay, and do you have savings, liquid savings, what I call an emergency fund?

Yes. All right, how many months expenses do you have in that? Probably, oh, probably about 10, 12. Okay, 10 to 12 months, that's great. Excellent. Well, let's do this. We're going to take a quick break. When we come back, we'll get Mark to weigh in on this.

In addition to that $100,000 retirement account with the proceeds of this home sale, how might you think about investing in gold specifically? And we'll even address that idea of a gold IRA. Jeff, you stay right there. We'll be answering your question just on the other side of this break. Mark Biller with us today. This is Faith in Finance Live. We'll be right back. Thanks for joining us today on Faith in Finance Live. Mark Biller here today.

We've been talking about gold and precious metals, how you should think about owning gold in your investment portfolio. Before the break, we were talking to Jeff. He's recently sold a home. He's got $100,000 in profit. In addition to that, he's got a PSP, essentially a retirement plan with about $100,000 in it. Four years out from retirement, he's got about a year's worth of emergency reserves as well. He's wondering about an allocation toward gold.

One more question, Jeff. How do you plan to cover your income needs in retirement? Are you going to just live on Social Security alone? Are you looking to pull an income from this retirement account?

What are you thinking there? Well, yes. At 59 and a half, I believe I have to – I just turned 59 yesterday. At 59 and a half, I believe that I have to start pulling out of that retirement fund. No, you shouldn't.

You should be able to let that just continue to grow. It's just that once you reach 59 and a half, if you do pull it out, you don't have to pay a penalty on it. So the key would just be putting your budget together and determining how much monthly income you need in retirement and then comparing that to what income opportunities you have, Social Security, and if you need to pull an income stream from this retirement account, just making sure you pull a reasonable amount. Typically, we use it as a starting point, 4% a year as a withdrawal rate so that you don't deplete it.

If the Lord tarries and you're in good health, you may need that money to last 20 or 30 years. But Mark, given all of that, how would you think about helping him invest a portion of this in precious metals? Yeah, well, Jeff, what we would do is we would look at that $200,000 total portfolio amount, and we would say, okay, maybe 5% of that, which would be $10,000 in this case, that would be an appropriate rough goal, nothing concrete, but roughly the right amount to be thinking about for maybe a physical gold allocation. Then on top of that, our SMI members, they have a bigger allocation, most of them do right now, to gold because of the specific economic environment, market environment that we're in right now. But I would hesitate to recommend that as a permanent thing because gold is a very defensive asset. Six months or a year from now, if we're looking around and the recession risks are gone and everything kind of has gone back to normal and the markets seem healthy, we won't have a higher allocation to gold at that point. We're still in more of a defensive mindset today, which is why our gold allocation is higher. But for folks who are following our SMI signals and so forth, we might have another, say, 10% or so allocated right now to gold through these gold ETFs that we've been discussing. So that would be about a 15% total. That's really high. Most financial advisors would hear that and go, wow, that's a lot to have in gold, and it is. But for us, that's kind of a temporary thing where it's temporarily high today and will be temporarily lower at some point in the future. So it's kind of a moving target for us. But hopefully that gives you some guidelines, at least as a starting point, Jeff.

I wouldn't overdo it because you do want to keep that money, that purchasing power growing, and that's what some of those other investments, your stocks and so forth, are for. Yeah, very good. Thanks for that, Mark. Jeff, appreciate your call today. Let's head to Cleveland. Hi, Bob. Go ahead.

Hey, Rob. All right, so you guys kind of answered a little bit of the question I had, but we have some friends who are doom and gloomers, so they are going nuts buying tangible gold. And so we're sitting here going, all right, are we missing something? And we're not looking at it for our portfolio. It would be more on the flip side that if something did tank in the economy terribly, it's like, is this something that we should have? And I kind of like that junk bag you were talking about. So that kind of helped a little. But and then if you do have investment in gold, how are you getting it if the doom and gloom day comes?

Yeah. You know, Mark, everybody's got that friend who's stockpiling gold. How would you counsel Bob here?

Well, I think the first step, Bob already has covered. You want to have a friend that has a big, a big truckload of gold. So if things really get bad, you've got a good friend like that now. But in all seriousness, it is tricky to know what to do with that. And I think, Bob, you actually raise a very good point that a lot of times we overlook when we're thinking about these worst case scenarios, which is if things ever really do get that bad where we're transacting and metals and things, you know, that's really a whole different mindset and things, you know, that not I'm really not being silly, but things like seeds and bullets and medicine and things like that are probably going to be even more valuable on that type of environment. So, again, we want to kind of just keep our frameworks clear. We want to be proactively prepared and we don't want to be flippant about the risks. But at the same time, we don't want to overemphasize the dangers either. And so, you know, I think that what we've been talking about today, that five percent type physical allocation is a great starting point. If you feel like you want to have a little bit more and you can afford to do that within the context of the rest of your portfolio and financial plan, that's fine.

That's just the level where we think most people start really kind of cutting off their other opportunities and what they're going to need for their retirement planning if they're going too heavily in gold. Rob, any follow up? No, I think you're right on the money there, Mark. Bob, we appreciate your call today. Lewis has a bonus question, a little off topic here today, but we're delighted to have you on the program. Let's head to Chicago. How can we help you, sir? Hi.

Good afternoon and thanks for taking my call. My question is about, I mean, we need to replace our used somewhat troubled car. So we look into buying a new car. And so my question was, would it be wise to get a loan against my 401K, pay the car cash and instead of paying interest to the financial institution, be better to pay interest to myself and to my 401K and also being able to contribute my normal contributions on top of the payment, the loan payment. Yeah, very good.

It does, Lewis. I would encourage you not to do that. I would counsel you just to buy that car that fits your budget, perhaps a few years old. I realize cars are challenging right now because they're still high prices, but if you take it out of the 401K and borrow it, number one, it's not there to grow, which is why it's there in the first place. So you're missing out on the compounding. Number two, if you were to separate from the company, it's a pretty steep tax bill, especially if you have a 10 percent penalty under the age of fifty nine and a half. So I'd rather you, despite these high interest rates, borrow as little as possible, put as much down as you can, and then you could look to refinance it when rates come down if you haven't paid it off yet.

But I wouldn't borrow from that 401K. Thanks for your call, sir. Mark, we've got just a couple of minutes left. Why don't we finish up today with your outlook there at SMI for gold and precious metals moving forward? Yeah, well, I think the long term outlook for gold is very strong.

I'm very favorable on it. Part of that is what we talked about earlier with interest rates. You know, they have come up so high at this point that if we do see a recession or economic trouble, you would think the normal pattern is that they would come down in the face of recession as the Fed cuts rates. Falling interest rates are good for gold price, as is the typical government reaction of spending even more money and borrowing even more money that tends to get gold revved up. So I think there are a couple of catalysts over, say, the next six to 24 months that look real positive for gold. The one caution I would throw out there is just that at the beginning of recessions and financial panics, market downturns, it's very common for gold to go down first with everything else because gold is very liquid and people can sell it easily. So don't be surprised if we have a recession, if the markets do fall again, if gold goes down first and then recovers quickly higher. And the point of throwing that out there, Rob, is simply that if people are listening and thinking, yeah, I'm going to bump up my gold allocation, you may not want to load the boat today. You might want to hold some money in reserve because dollars are actually the best thing to have in a crisis because you can buy into those lower prices should they come at some point down the line. So very favorable longer term outlook with just a little asterisk that you could see a bump in the road en route to those higher gold prices first. Yeah, that's helpful.

Mark, just 45 seconds left. Just recenter those that have gotten swept up in a little bit of the fear mongering and just remind us where we need to place our trust here in these uncertain times. Yeah, absolutely. You know, there have always been crises throughout history. Gold has helped through some of those, but it's never our foundation.

It's never our ultimate safety. That is in the Lord. And so we want to be wise in our preparations, but we don't want to transfer our hope and our comfort into these types of investments, whether it's gold or anything else.

So I would just encourage people to prayerfully ask the Lord about making these types of preparations and including gold in those plans. Yeah, very good. That's very well said, Mark.

Well, we've covered a lot of ground today. We're so thankful for our partnership with Sound Mind Investing and we appreciate your time today. Thanks, Rob.

Always glad to be with you. All right. That's Mark Biller. He's executive editor at Sound Mind Investing. If you want to read the article we've been talking about today, Checking Up on Gold, head to their website, soundmindinvesting.org. That's soundmindinvesting.org. Let me remind you here in the last two days of August, if you'd like to help support our work here at Faith and Finance Live, you can make a gift of any amount on our website at faithfi.com. That's faithfi.com.

Just click Give. On behalf of my team today, Amy Rios, Dan Anderson, we're grateful for Lynn handling our phones as well as Jim Henry providing great research today, and Mark Biller. I'm Rob West.

Faith and Finance Live is a partnership between Moody Radio and FaithFi. Have a great rest of your day and come back and join us tomorrow. We'll be here. God bless you. Bye bye.