A pound of prevention is worth …

Gold is down again today. It is off about $10 to $1,128.10 a troy ounce.

In the past half year, it has been falling.

During the financial crisis, I adopted a form of gallows humor when stock prices were plunging.

As each of my retirement statements came in at lower and lower values, I began to joke that if they were converted into British pounds, they didn’t look so bad.

Why?

At the time, the pound had tumbled very dramatically from an exchange value of $2 to $1.50.

That 25 percent decline made the retirement figures look less bad than they were.

Interestingly, during the six months of the 2016 downtrend that has been affecting gold since the June Brexit vote in Great Britain, I can make the same joke.

Gold has tumbled by roughly 17 percent since the dollar price high of $1,365

The British pound by coincidence is also down by about 17 percent from its 2016 high point.

In effect, the price of gold has not moved when looked at in terms of British pounds.

This might seem a bad joke to Americans who look at everything in dollar terms. But the fact is, sometimes it pays not to look too closely at daily gold price swings.

Back in the opening weeks of 2009 when the stock market averages were relentlessly falling, holders of accounts like mine could very easily have sold everything at market lows.

Some did.

In the long run, that was a very foolish thing to do now that the Dow Jones Industrial Average has nearly reached 20,000. It was below 7,000 at the market bottom almost eight years ago.

I sat tight with my British pound joke.

Now that gold has been dropping for six months, it might be tempting to get out.

Make the bad news go away by selling.

You might be right for a day, a week or a month, but if you are in it for the long term, don’t yield to daily bad news.

Long term, do you believe inflation will stop?

Long term do you believe the U.S. dollar will retain its purchasing power?

Long term, do you believe world peace and harmony will make a hedge against uncertainty like gold unnecessary?

If my British pound joke helps you to ignore any negative daily fluctuations in gold's price, feel free to use it.

Buzz blogger Dave Harper has twice won the Numismatic Literary Guild Award for Best Blog and is editor of the weekly newspaper "Numismatic News."

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