The Case for Investing in Gold

by Frost on January 18, 2011

{ 3 comments… read them below or add one }

Rivelino February 1, 2011 at 9:17 pm

what about investing in the chinese currency?

tacticalchrstn January 26, 2011 at 8:45 pm

A person cna’t go wrong with gold as a store of value over a very long time frame, but one might get burned with gold investing in the short term. We’ve had a huge run up in gold over the last few years that reminds me of the late seventies run up. People who invested in gold in 1980 had to wait a long time to see their investment return to anything close to what was paid in if they failed to sell at the peak. Gold fell sharply when the banking crisis occurred a couple of years back and has rebounded strongly since then. If the economy tanks I expect both gold and oil to fall sharply again in a “head fake” as investors flee stocks, bonds, and commodities all at once and rush back to the greenback. The headfake will not last and the dollar will become worthless as inflation takes hold, but deflation is more likely in the short term if we have a double dip recession or depression. Sooner or later the combination of peak oil and reckless fiscal policy means our society is doomed. A few of us who make all the right moves could be sitting pretty for a while though… Check out Charles Hugh Smith’s commentary on these issues.

Ancel De Lambert January 26, 2011 at 12:45 am

One quick thing to remember about the “inherent value of gold,” is, as you mentioned, it can’t be created. This goes pretty deep, as to get more gold, and therefore more money, one must put forward the cash necessary to go dig the damn stuff up. Gold is respectable because it requires effort to obtain.

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