Few things fire up the imagination like lost treasure, buried away just waiting to be found. We take a look at four gold hordes that people continue to look for to this day.

The 1715 Spanish Treasure Fleet

A fleet of twelve Spanish ships was en route to Spain from the New World when a catastrophic hurricane hit. Only one ship survived. The other eleven sank off the eastern coast of Florida. Each carried immense wealth. However, one, in particular, carried the motherload. The San Miguel is considered by many to be one of the most valuable treasure galleons ever lost. To this day, treasures from this ship and others from the fleet wash up on Florida beaches. In September of 2013, one lucky family found $300,000 worth of gold less than 200 yards offshore. The total value of the San Miguel and other ships is well into the hundreds of millions and people continue to search the seas for the fortune.

Fenn’s Folly

Nothing changes one’s perspective like a terminal diagnosis. In 1988, art dealer Forrest Fenn learned that he had cancer. Doctors told him he had less than two years to live. This ticking clock inspired him to bury $1 million of his wealth. He encouraged treasure hunters to find the horde and even provided cryptic clues. He wrote a poem with confusing lines like, “Begin it where warm waters halt And take it in the canyon down, Not far, but too far to walk.” Though the idea came to him after his diagnosis, he buried the treasure twenty years later after beating the illness. No one has found the stash though Fenn claims some seekers have come as close as 200 feet to the site. Fortune hunters be warned: two people have died searching for Fenn’s legacy.

Victorio Peak

Some gold hunters believe the Southern Rocky Mountains of New Mexico are hiding millions in god buried within a collapsed mine shaft. The story begins with Milton Ernest “Doc” Noss. He was on a deer hunting trip when he made the find. Liberating the treasure proved difficult. There was only one way out of the mine, and the opening was too narrow to effectively remove the gold. Foolishly, the “Doc” decided to use dynamite to blast a larger opening. This attempt, unsurprisingly, collapsed the entrance sealing the riches away. Doc Noss lived only a few years more; an associate shot him amid a dispute. Thought the Noss family continued to press for access the US government stepped in taking control of the area for use as a nuclear testing site. Officials claim they never found Noss’s alleged gold. To this day we don’t know who is telling the truth.  

Schultz’s Shuffle

The life of a crime boss is hard. Dutch Shultz was a New York Mobster living large in the 1920s and 1930s. He made a fortune bootlegging and conducting organized crime. It wasn’t long, however, before the tax man came knocking. Eventually, he was indicted by a Grand Jury. He arranged for a professional to build a special watertight safe in which he stashed $7 million to keep away from other mobsters and the Federal Government. He hid it in the Catskill Mountains with the intention to retrieve it later in life. Schultz was eventually shot and killed. Many believe his fortune remains buried. Find it, and it’s yours.

With a relatively new president in office many have cited the uncertainty of our times with regard to investing. However, this notion that a US president can single-highhandedly control the economic landscape of the country is misguided. In truth, policy changes from Federal Reserve hold much more sway over the state of our markets. Now is an especially good time to revisit this fact as Janet Yellen, the current Chair of the Federal Reserve prepares to step down. Jerome Powell will soon be taking over prompting many to question how this new leadership will influence our economy.

Many consider Powell to be a continuation of Yellen’s policies. “A Powell Fed might look a lot like it has since Mr. Greenspan retired in 2006,” remarked The Wall Street Journal. Though many are comfortable with Powell as a successor this changing of the guards has become a reminder of how administration changes can wield influence. A clearer, though less discussed, example is the news that William Dudley, the leader of the Federal Reserve Bank of New York, announced that he’ll be stepping down early than expected. This move has led some to speculate on “the uncertainty over whether the central bank will be more hawkish with its rate increases moving forward depending on who fills the open positions.”

Why does this matter for gold investors? Unexpected events like this help stabilize gold prices by effectively creating a “floor” even in times of falling value.

Gold prices have fallen in recent weeks hitting multi-month lows. This comes at a time when gradual increases in rates has reinvigorated investors’ appetites for yield-bearing investments. However, uncertainties in other areas, like the Federal Reserve Bank of New York, keeps investors vigilant. This cautiousness helps prevent further slips in gold prices.

On a global scale, instability in Spain’s government and Venezuela’s economy are also fueling the fire. Investors can get a concise, holistic measure of uncertainty around the world with the Economic Policy Uncertainty Index. This single number represents a reading based on two components. The first quantifies uncertainty within newspaper coverage of economic policies. The second gauges how many federal tax code provisions will expire in the coming years. A reading of this figure from January 1, 1997 to October 1, 2017, shows a clear upward trend reaching an all-time high in January of this year. Until October of 2008 the figure had never risen above 200. Since then the index has broken the 200 mark on six occasions.

This is a visual illustration of the pervading uncertainty that makes gold a worthwhile, long-term investment. While many eager investors get caught up in the moment, the long-term is what counts. Recent events, which are pushing gold down, are fleeting. However, the supportive elements that prevent a complete collapse of gold prices are consistent because they’re based in the inherent uncertainty of an increasingly complex world.

The key for success remains the same; investors must maintain perspective on the wider picture while ignoring the headlines that pray on passing fears.  

American women are fond of saying “Diamonds are a girl’s best friend.” Not as well-known are the origins of that saying, which can be traced to a 1947 De Beers mining company advertising campaign.

In the Indian culture, “No gold, no wedding” is a popular saying. That underscores the significance of gold in the fabric of Indian society. Rare is a marriage that takes place without some sort of gold being presented to the bride. Gold coins are common gifts. Even in the poorest family a simple gold nose ring is presented.

In India, families build and save their wealth in the form of physical gold. This is often in the form of extravagant jewelry pieces worn by the women of the family. The finest Indian wedding dresses include thread made of actual gold. These gowns are wrapped away in protective coverings and stored in family homes as a protection against hardship or a “rainy day.”

Indian households control an estimated $600-$800 billion of gold, at 2014 estimates and prices, or four times the amount of gold held in Fort Knox. Given the significant price increase in gold in recent years that number is even higher now.

Owning physical gold in India is a type of “insurance policy.” Women stockpile gold. It begins as gifts from their mothers and extends to gifts from in-laws, her husband.

Facts about India:

1. The economy is healthy in India. The IMF forecasts the Indian economy to expand at a 7.2% pace in FY 2017-2018.

2. It is the world’s largest democracy.

3. It is the second largest country in the world by population, home to over 1.2 billion people.

4. India is the world’s second largest gold market. Indians typically buy and hold gold – for generations. Gold is passed down from generation to generation.

What this means to American investors:

The Indian economy continues to develop. As more individuals and families become educated and get well-paying jobs, they will continue to funnel a portion of their assets into saving in gold.

Indian gold demand is a long-standing driver of upward pricing in the metals market. And, it is not going away. Instead, it is expected to continue to grow as Indian citizens are lifted out of poverty and into the middle class. This will mean even more gold demand in the future.

American investors turn to gold for many reasons. A portfolio diversifier, an inflation hedge, a protection against paper money devaluation. Indian investors turn to gold as a cultural wealth building tool. It is deeply ingrained in their culture and gold demand will grow as more Indians have the ability to purchase the metal. More demand means higher prices.

Gold that you are buying now will help preserve and grow your wealth too.

Stay on top of news and trends with the Blanchard eNewsletter

Get the latest tangible assets news, insights and buying recommendations delivered to your inbox every month. Enter your email address at the bottom of this page to subscribe.

What’s Trending Now? Read More:

Since 2017 Started, Your One Dollar Bill Is Now Worth 91 Cents

Follow David Beahm, CEO of Blanchard & Company, on LinkedIn to read his weekly articles on the metals markets, the economy and how investors can thrive in today’s uncertain times

Gold is critical on the stage of the global economy. In fact, it’s so important that eleven nations formally agreed that the commodity is a mainstay of sovereign nations. While die hard equity investors often eschew gold as a relic of the past, the fact remains that our world’s economy requires gold as an international reserve. This is the belief underpinning The Washington Agreement on Gold first signed in 1999. It includes five major statements on which countries like England, France, Italy and the U.S. agree.

First, they all agree, that gold will remain an important element of global monetary reserves. This belief is illustrated not just by nations agreeing to the statement, the numbers also support their conviction. As MarketWatch reports, “Around 20% of all the gold ever mined is held by central bank and governments, with the biggest official holdings at the U.S. Treasury with 8,134 tons.” Research from the Official Monetary and Financial Institutions Forum posits that central bank activity surrounding gold can be delineated into “Seven Ages,” the most recent of which started in 2008 in response to the global financial crisis. They explain that since that upheaval “central banks in both developed and developing countries have shown a new fondness for the yellow metal, rebuilding gold’s importance as a bedrock of most countries’ foreign reserves.”

The second component of the agreement asserts that “The above institutions will not enter the market as sellers, with the exception of already decided sales.” This statement helps preserve the longevity of the agreement ensuring that the included countries maintain an equilibrium. Third, the document states that any sales arraigned before the agreement will occur over a period of five years with annual sales not exceeded 400 tons. Fourth, the countries agree that they will refrain from expanding gold leases and gold futures and options over the period of the agreement. This statement is, in effect, an extension of the promise to not enter into the market as sellers.

Finally, the countries agreed to review the agreement after a period of five years. History shows they all held up with end of the bargain and renewed the agreement in 2004, then extended in again in 2009. This is the reason that “Central banks have been net buyers of gold since 2008, and today comprise a significant portion of annual gold demand,” according to the World Gold Council.

What is most striking for investors about this agreement is the powerful message it sends regarding the importance of gold in global markets. It stands to reason that if all of these countries can pledge their commitment to hold reserves of gold then ordinary investors can have faith in the immutable value of the commodity. Case in point: we’ve seen central bank gold holdings increases steadily since 2007 where total holdings were nearly 30,000 tons. By comparison, in Q1 of 2017 that figure is over 33,000 tons. The longevity of the agreement may be rooted in the fact that in times of crisis gold outperforms US Treasuries, Japanese government bonds, German “bunds,” and UK gilts. Here, “crisis” includes events like the 1987 market crash, the Dot-Com bubble, September 11^th and the global financial crisis of 2007.

If holding gold for the long-term is good enough for global nations it’s good enough for investors.