Poll: What Percentage of Physical Bullion do you hold?

[Storm]

Yes, when I was in Shanghai I visited a 3 story tall jewelry store that sold everything, including everything from 1 gram up to 1 kg bars.  It was really amazing... I converted the price to ounces and found out that 100 gram bars were exactly the same as gold spot price - tempting.  I seriously wonder how they were able to sell physical for the same as spot price - perhaps they are fake, or weigh slightly less than advertised?  Anyway, I can see the appeal of physical gold.  I mean, I've owned GLD since physical was $900 an ounce.  Just having significant appreciation in value without the specter of capital gains tax hanging over your head is damn appealing.  I know you're supposed to claim it as a profit, but would the IRS really be able to find out what you bought those coins for 20 years ago?

Definitely a cool story.  I have seen a 1kg bar going for spot at a online vendor before, maybe the price had just risen or they were trying to reduce their inventory of certain items?  Still, a GLD owner for at least 4 years and not a single oz of physical? Have you considered any scenarios in which the paper and physical price might diverge?  

It should be noted that several countries already do not tax gold bullion (British Sovereigns in the UK for example).  I suspect this may be the case in the US sometime in the future as well.  Another good reason to hold 24 karat over 22 karat.

Yes, I've considered SHTF scenarios where GLD might not be redeemable, or the USD might not be the currency you would want to redeem it in, however, in such a situation I think I would have worse things to worry about than how to get my 192 shares of GLD.

The main reason I've stayed in paper gold, as mentioned earlier, is that I want to be liquid because it is highly likely that in the next couple of years I'll need to sell that GLD and put a downpayment on a house.  After I purchase a house and rebuild my taxable savings, I fully plan on owning at least 10% of my total PP in physical (keep 10-15% in paper for rebalancing purposes).

[Storm]

I tend to disagree with the smart folks who see house prices continuing to go down. My reasoning is simple... in my local market, if prices go down any further, rich people will have no place to live, because young families, recent college grads and other people who should be struggling, will be snapping up all the high-end homes. I find this illogical 

It really depends on where you live.  I live in the Northeast where house prices didn't even peak/start to drop until 2007.  Other areas where the bubble burst in 2005 might be closer to a bottom, however, don't discount the effect rising interest rates might have.

Just ask yourself - what is the median income where you live, and what is the median home price?  Can you afford a 30 year mortgage payment on a median home with 25% of the median income?  If the answer is no, you can't afford it, the median price will come down.  It's simple math.  For recorded history, home prices have never exceeded 25% of a household income.

I've heard of places in Florida where brand new houses are selling for less than the cost of materials and construction.  This is totally normal.  If I go to a tribal village in Africa that uses a system of barter and glass beads for money, and build a $1 million McMansion, should I be surprised when the best offer I get for the house is a cow and a thousand glass beads?  That's simply the price the market will bear.  Construction cost has nothing to do with it.  If I am desperate and have to sell to cut my losses, I'll take the cow and beads.  Otherwise the house is really just a wooden box that will rot outside in the rain until it eventually deteriorates.