Gold Price Hits New High Today

[Naam]

Max, you can't reason with gold bugs, with those types of people gold is a religion not an investment

i couldn't agree more. "gold bugs" have always neglected reality and are shying away when you confront them with historical facts. they keep a rather low profile during the years when their wives have to take up jobs as cleaning women and/or selling their daughters into slavery for their financial survival and surface only once in a while to make derogatory remarks about "fiat money" and "colourful pieces of paper". but once the gold price is moving up they start shouting "I TOLD YOU SO! NEXT STOP X-THOUSAND DOLLARS PER OUNCE!"

nota bene: please take my opinion not with the proverbial grain of salt. use a pound (or two) of salt

[tropo]

So is it a good idea to buy gold? Gold always seems to keep it's value--any thoughts?

I wouldn't buy now while it's at historic highs although some are predicting it could reach $1000 soon, and then up to as high as $1,100 - $1,200 before it corrects.

If you decide to buy now it should only be to ride the wave a little higher and sell again. If you're looking at buying gold to hold onto, I'd wait.

[ray08]

So is it a good idea to buy gold? Gold always seems to keep it's value--any thoughts?

I wouldn't buy now while it's at historic highs although some are predicting it could reach $1000 soon, and then up to as high as $1,100 - $1,200 before it corrects.

If you decide to buy now it should only be to ride the wave a little higher and sell again. If you're looking at buying gold to hold onto, I'd wait.

Gold is in very dangerous territory , all you need is some East European country to dump their reserves to cash in on high price and it will go down sharp ,or for some great data to come out of Amereica ,or any other silly reason NO FUNDAMENTALS on gold , more chance going to Maccau and betting on the tables than making on Gold , Yes it is being pushed to $ 1000 , but when gold falls it goes very fast and hard to get out of any trading position,

[thaistocks]

Gold is priced in US$, and so has hardly had as good as a year as people think. The SET/or even better MAI Thai stock exchange has showed better returns last year, and in a currency which has gone up quite a bit vs. the US$!

Gold has a negative return while you wait, as it pays no regular dividends and is "expensive" to hold, or shall we say hide. As it can get lost/stollen or at least runs up vault charges. And what about VAT taxes?

Gold may well move higher in 2008, but certain Thai stocks will do even better, as time goes on. Gold is a uncreative way to invest, you just bet for the end of the world, or ever higher inflation or collapsing economies, then hope for the best, in this case the worst.

[m02]

Here's a different view on gold and its uses. There is lots of gold in Laos, and many villages have a tradition of panning gold to supplement income; and at the same time tourists now days can even get a permit to indulge in a little 'prospecting'. I worked in Laos for a couple of years in the more remote areas on health care infrastructure development programs, so was working with villagers on a daily basis. One project I wanted to start up for a group of really wonderful ladies in one village was a handicraft / tourism co-operative centered on running small gold panning tours and making and selling gold handicrafts for these same tourists. The traditional method of selling has been to local gold shops where they get about 50% of retail, which isn't that bad, but if they could make their own jewelry and sell to tourist they could get over 100% and perhaps up to 150%. This combined with the income from the tours would be a god sent to these people. This was a project I was going to do on my own but unlike some of the wiser business heads who post here I haven't invested wisely and lack the funds to set this up. If anyone is interested in something like this and would like to spend their next vacation helping some really nice people and pan for gold at the same time, drop me a note (PM). It would probably only take a couple groups of willing volunteers to kick start something like this. The villages are very agreeable to the idea and are really great people who are in a very difficult situation economically wise.

[gregb]

Time for a little Sunday night flame bait with this topic.

I'm long on gold. I've been long on gold for 3 years, and I will continue to be long on gold for the rest of my natural life. Gold increased 30% in 2007. It will continue to increase an average 20% a year for the indefinite future.

People who were trained to believe in fiat currency simply can't accept this. However, anything learned about finances in the last 30 years is completely worthless for the next 30. We have passed into a new era, and that era is energy depletion/peak oil.

Economic growth simply can not occur without exponentially increasing energy. That is one thing that doesn't exist anymore. This is an inescapable truth. Economists don't understand physics. On the other hand, a fiat currency can be inflated to infinity, and it will. Since all economies on this finite planet can no longer grow in a meaningful way, the only option to create money to pay off interest is through inflation. It's either that or else let the banks foreclose on everything and go bankrupt while stuck holding worthless assets.

Real inflation (expansion of the money supply, not the reported statistic which is manipulated and meaningless) will be on the order of 20%. People who understand this also understand that with energy depletion mining operations will become more and more difficult. Gold from now on will track the price of oil, and that direction is strongly up. The ability to increase the above ground gold supply will be constantly reduced because of the difficulty in obtaining energy to extract it. Gold is a store of wealth, and is the only "money" on the planet that can not be inflated at will by governments.

Gold has been used as money for thousands of years. It will continue to behave like money, even if most today don't like that idea.

Gold will hit $1000 this year. In the future it will hit $2000, then $5000, and on and on...At each step people will be saying it is overvalued. Somehow there will always be strange people who keep buying it, and no one will understand why. Eventually, all fiat currencies will collapse, whether Sterling, Dollar or Euro, just as every single one has throughout history. Those strange people who bought gold won't care. Gold will still be a store of wealth, and it will be redeemable in whatever rises up in the ashes.

So buy gold now. By all means try and buy at the dips, but for anyone who thinks gold is overvalued, I'm sure the buggy whip manufactures didn't want to hear about the automobile either. Fiat currencies have had their day, and they are rapidly approaching the end of their useful life. They no longer represent a store of value. Get out while you still can.

BTW, I'm not a gold bug. I'm an engineer and a scientist. The market may behave erratically for a while, but trust me when I say physics will win in the end. Barring a miracle or massive depopulation, there is no way out.

[ray08]

Time for a little Sunday night flame bait with this topic.

I'm long on gold. I've been long on gold for 3 years, and I will continue to be long on gold for the rest of my natural life. Gold increased 30% in 2007. It will continue to increase an average 20% a year for the indefinite future.

People who were trained to believe in fiat currency simply can't accept this. However, anything learned about finances in the last 30 years is completely worthless for the next 30. We have passed into a new era, and that era is energy depletion/peak oil.

Economic growth simply can not occur without exponentially increasing energy. That is one thing that doesn't exist anymore. This is an inescapable truth. Economists don't understand physics. On the other hand, a fiat currency can be inflated to infinity, and it will. Since all economies on this finite planet can no longer grow in a meaningful way, the only option to create money to pay off interest is through inflation. It's either that or else let the banks foreclose on everything and go bankrupt while stuck holding worthless assets.

Real inflation (expansion of the money supply, not the reported statistic which is manipulated and meaningless) will be on the order of 20%. People who understand this also understand that with energy depletion mining operations will become more and more difficult. Gold from now on will track the price of oil, and that direction is strongly up. The ability to increase the above ground gold supply will be constantly reduced because of the difficulty in obtaining energy to extract it. Gold is a store of wealth, and is the only "money" on the planet that can not be inflated at will by governments.

Gold has been used as money for thousands of years. It will continue to behave like money, even if most today don't like that idea.

Gold will hit $1000 this year. In the future it will hit $2000, then $5000, and on and on...At each step people will be saying it is overvalued. Somehow there will always be strange people who keep buying it, and no one will understand why. Eventually, all fiat currencies will collapse, whether Sterling, Dollar or Euro, just as every single one has throughout history. Those strange people who bought gold won't care. Gold will still be a store of wealth, and it will be redeemable in whatever rises up in the ashes.

So buy gold now. By all means try and buy at the dips, but for anyone who thinks gold is overvalued, I'm sure the buggy whip manufactures didn't want to hear about the automobile either. Fiat currencies have had their day, and they are rapidly approaching the end of their useful life. They no longer represent a store of value. Get out while you still can.

BTW, I'm not a gold bug. I'm an engineer and a scientist. The market may behave erratically for a while, but trust me when I say physics will win in the end. Barring a miracle or massive depopulation, there is no way out.

Now i,ve heard them all , still got no idea what a Fiat Currency is ,but i like the $2000 - $ 5000 prediction , them again you covered your bets with a MIRACLE

[icemaniac]

I am not here to discuss with you guys, i just give my humble piece of advice.

Fortunatelly, I never failed a forecast in the past years and I am adamant to follow this way. For me nothing will change if you will buy gold or euros now. I will be sorry for you in few years,unless you want to buy now and sell in 1-2 months...but I think you are not looking for a short-term speculation.....

There is nothing HUMBLE about your inane advice. Quite the contrary. You're an armchair trader whose trying to dispense foolhearty advice to people who have no business following your advice. They'll lose their shirts by following the shallow recommendations you've posted on this site. Beware of this guy everyone.

[tropo]

Gold will hit $1000 this year. In the future it will hit $2000, then $5000, and on and on...At each step people will be saying it is overvalued. Somehow there will always be strange people who keep buying it, and no one will understand why. Eventually, all fiat currencies will collapse, whether Sterling, Dollar or Euro, just as every single one has throughout history. Those strange people who bought gold won't care. Gold will still be a store of wealth, and it will be redeemable in whatever rises up in the ashes.

Gold already hit $2,176 per troy ounce in 1980 adjusting for inflation (using 2006 dollar value).

[Martin]

'gregb' said, in post #36:

"BTW, I'm not a gold bug. I'm an engineer and a scientist. The market may behave erratically for a while, but trust me when I say physics will win in the end. Barring a miracle or massive depopulation, there is no way out."

I am an engineer (though not a scientist---I steer clear of all -isms, and am no -ist), but I think it is geology that is at the root of present-generation matters.

The plain fact is that all the exosomatics (the things that we extract from within the body of the Earth) are getting harder and harder to come by.

Consequently, in our longer-term considerations about maintaining the purchasising power of our savings, it does appear that the currencies of nations whose citizens have become dependant on such extraction are dodgy. The US dollar is a particular example as Americans are, in the words of their President,"addicted to oil".

As far as my successors are concerned, they'll find that I have left productive land to them, and whilst waiting for more to come on the market adjacent to what we have, I'll keep my savings in gold.

I have no interest in quick-fire gambling amongst currencies or stocks and shares, but if I had, I would be very wary at the present time.

So many of these stratagems of which we hear were developed for times that were very different from the present.

As a pupil and as a student engineer, I was taught that a formula is only valid as long as the assumptions in its derivation continue to hold true. Since these market-playing strategems are essentially just formulae derived in times past in the markets of the day, which were underpinned by exosomatics (particularly oil and gas) being easier and easier to get, these stragems may have very different success rates from here on in.

Caveat emptor---whatever you buy as your way of storing value.

[chinadarling]

1st - if there were a fool-proof way to make money people would be doing it and not broadcasting

2nd - the English on this thread is unbearable. Check/proof read before you hit 'add reply'

Edited January 6, 2008 by chinadarling

[lannarebirth]

Time for a little Sunday night flame bait with this topic.

I'm long on gold. I've been long on gold for 3 years, and I will continue to be long on gold for the rest of my natural life. Gold increased 30% in 2007. It will continue to increase an average 20% a year for the indefinite future.

People who were trained to believe in fiat currency simply can't accept this. However, anything learned about finances in the last 30 years is completely worthless for the next 30. We have passed into a new era, and that era is energy depletion/peak oil.

Economic growth simply can not occur without exponentially increasing energy. That is one thing that doesn't exist anymore. This is an inescapable truth. Economists don't understand physics. On the other hand, a fiat currency can be inflated to infinity, and it will. Since all economies on this finite planet can no longer grow in a meaningful way, the only option to create money to pay off interest is through inflation. It's either that or else let the banks foreclose on everything and go bankrupt while stuck holding worthless assets.

Real inflation (expansion of the money supply, not the reported statistic which is manipulated and meaningless) will be on the order of 20%. People who understand this also understand that with energy depletion mining operations will become more and more difficult. Gold from now on will track the price of oil, and that direction is strongly up. The ability to increase the above ground gold supply will be constantly reduced because of the difficulty in obtaining energy to extract it. Gold is a store of wealth, and is the only "money" on the planet that can not be inflated at will by governments.

Gold has been used as money for thousands of years. It will continue to behave like money, even if most today don't like that idea.

Gold will hit $1000 this year. In the future it will hit $2000, then $5000, and on and on...At each step people will be saying it is overvalued. Somehow there will always be strange people who keep buying it, and no one will understand why. Eventually, all fiat currencies will collapse, whether Sterling, Dollar or Euro, just as every single one has throughout history. Those strange people who bought gold won't care. Gold will still be a store of wealth, and it will be redeemable in whatever rises up in the ashes.

So buy gold now. By all means try and buy at the dips, but for anyone who thinks gold is overvalued, I'm sure the buggy whip manufactures didn't want to hear about the automobile either. Fiat currencies have had their day, and they are rapidly approaching the end of their useful life. They no longer represent a store of value. Get out while you still can.

BTW, I'm not a gold bug. I'm an engineer and a scientist. The market may behave erratically for a while, but trust me when I say physics will win in the end. Barring a miracle or massive depopulation, there is no way out.

You may be right about all you say, but if Gold desn't go back and retest it's breakout in the 660's soon, it will probably make a blowoff top (perhaps a spectacular one) and revert to being in a bear market.

[glaitong]

Hold the gold! _uck the bucks.

[tropo]

Here's an interesting table of yearly gold prices from 1793 - 2005.

Gold Prices 1793 - 2005

Before someones mentions the inflation factor, $20.00 in 1793 was worth $16.98 in 1900 using the consumer price index.

In fact $20 was worth around $20 from 1793 up until 1917 when inflation started to erode it's value.

Here is the relative value of a 1793 US $20 bill using the consumer price index.

1900: $16.98

1910: $19.21

1914: $20.21

1915: $20.31

1916: $22.19

1917: $26.74

1918: $31.41

1919: $36.08

1920: $41.79

1921: $37.33

1922: $32.97

1923: $35.60

1930: $32.83

1935: $28.63

1940: $29.26

1945: $37.54

1950: $50.22

1960: $61.77

1970: $81.00

1980: $171.80

1990: $272.58

2000: $359.12

2006: $420.44

It's fascinating stuff. Imagine a $20 bill in 1915 being worth over $420 today.

These and other interesting calculations can be done at:

Measuring Worth

Edited January 6, 2008 by tropo

[Naam]

Gold will hit $1000 this year. In the future it will hit $2000, then $5000, and on and on...

BTW, I'm not a gold bug. I'm an engineer and a scientist...

...and quite obviously a prophet

[chownah]

A twenty dollar bill from 1915 would be worth twenty dollars today if it was a circulated bill with normal wear and tear.

chownah

[churchill]

From the FT

http://www.ft.com/cms/s/0/67e2a9b4-ba69-11...00779fd2ac.html

[churchill]

and very similar from today's telegraph

http://www.telegraph.co.uk/money/main.jhtm...6/ccgold106.xml

[tropo]

A twenty dollar bill from 1915 would be worth twenty dollars today if it was a circulated bill with normal wear and tear.

chownah

Of course someone had to come along and take my "$20 bill" reference literally.

Let's do it your way. The 1915 $20 bill was the first $20 Federal Reserve banknote printed in 1914. It was a large banknote of dimensions: 3.125 by 7.4218 inches

Are you sure this would be accepted as legal tender today?

Are you sure this would have no collector's value?

If you find one, let me know and I'll give you $20 for it.

I could have just as easily used 1905 as the comparitive year.

Try using that at your local 7Eleven. It should be worth $20 at least.

[BEENTHEREDONETHAT]

Most presidents who get their face on the bills have been dead for a loong time. Cleveland died in 1908 and was put on the 20$ bill in 1914. Interesting. And I know it has absolutely nothing to do with gold.

[VegasVic]

A twenty dollar bill from 1915 would be worth twenty dollars today if it was a circulated bill with normal wear and tear.

chownah

Yes inded that 1915 $20 bill would buy you exactly $20 worth of goods today. If the fellow who had that original bill back in 1915 was one of our gold bugs and had demanded his ounce of gold for it then he would have done quite a bit better, about $860 as of the close on Friday, and of course if that fellow had put his $20 to work in a secure and very conservative financial instrument lets say at 4% and he had the interest reinvested at that safe boring rate over the years then as of the close of business Friday he would have...? I guess I could really rub the gold bugs nose in it at this point and post the actual figure here, but instead I will suggest to any prospective gold investor out there to go to google and look up the compounding of interest and plug the aformentioned scenario into the equation. If any of you dare to undertake this little experiment you too will wonder why anyone in their right mind would ever invest in gold for anything other than a very short term trade. QED

[Captain Ron]

Selling $ now would be very stupid.

You should have sold $ in 2002 not now.

Now it is almost time to re-buy $

You need to sell expensive and buy cheap.

I'm always astonished by this way of thinking. Reminds me the "Great Reich that will last 1000 years"... This very human difficulty to understand that everything has an end is quite disturbing.

What datas allow you to think that a currency is "just" a "normal good" with "classic cyclical behavior" ?

History shows that fiat currencies have... a life span. Some might last more than other, but they are basically... disposable goods.

On the other hand, gold has a much longer history... I mean a real one. But USD ? A mere toilet paper.

you are naive.

this would be real in the world of dreams...

in 40 or so years gold will be a relic...just like oil...

there are a couple of dozens of big fish who decided gold would be up in these years and as soon as they will decide to sell (and make profits like crazy) --sell to people like you who always come 5 years late to buy the most expensive stuff in the market-- gold price will retreat again.

Look at the $ trend during the 3 past republican administrations.... that has been another planned devaluation by US Govt, just like previous Republican Administrations.

Gold is money. it is the ultimate currency and is now making all time highs against most of the major currencies, $, Euro, Aussie, loonie and even the Baht. In $ it's up 30% this past year and about the same each of the 2 prior years-you would have done well had you been buying gold during these times. Going back to the all time spike of $850 or so that was short lived panic driven buying, todays rise is slow steady and long. But if you want to go back long term go to 1971 when Nixon cut any ties of the $ to gold. Then it was $35 vs. $860 today. up almost 25x. BTW oil has risen about the same it was about 3.50/barrel then. historicly an ounce of gold =10 barrels of oil. Meanwhile all currencies are depreciating against both oil and gold the 2 standards of wealth. We are witnessing an historical credit crises that is spreading worldwide. the U.S. is leading the way. Central banks are minting money like it's going out of style (it is) to save financial institutions like citibank and keep credit flowing as the trust has been lost at a time when credit has been easier than ever before in history. If panic hits again it'll go a lot higher than the inflation adjusted all time high of about $2400. Even without panic we'll see gold double in the next 2-3 years.

Most traditional investments are looking bleak-bonds, stocks even real estate. Bush is clueless. the country is technicaly BK and we are in a recession in the U.S.-the only refuge is gold and they can't find enough of it anymore-mine output is decreasing and more expensive-meanwhile demand is growing-chinese are now allowed to own gold and have setup investment vehicles for doing so. If you think it will become a relic then you believe the entire world will be living under a socialist dictatorship-barring that the external and unquenchable desire to hold gold in europe, the middle east and most of all asia will insure it's value forever. Finally anyone living in Thailand especially as an expat should learn something from the locals-people in this part of the world trust gold more than governments and choose to hold thier savings in it. Just ask all those Burmese whose currency was cancelled back in 1988-oops sorry your life savings you put in your bank account is worthless. How rude, they could have been much more tactful and just let it's value decline by inflating the currency like every body else!

Get gold-a whole lot-you won't be sorry.

[Maxi101]

So is it a good idea to buy gold? Gold always seems to keep it's value--any thoughts?

Still remembering my brother in law crying about his gold investments 10 years ago.

The remark about buying cheap and sell expensive makes sense.

I wouldn't say America is dead, just wait and see.

It's actually great for their economy household.

It is true that gold keeps value - always, but is it not true that it stays at the same level, boyssss.

maxi

[Maxi101]

Well if you all want to lose money I dont care a s....

Fortunately I have never missed an economic forecast in the past 5 years . I sold all my $ in July 2002 (when people like you were saying dollar amazing strenght would last forever) and I will re-enter in the dollar area in a couple of months (when the same guys know they say the opposite) , consolidating a very big profit.

Even if the euro will rise some further , my profit will be a huge consolidated profit.

It is because people like you who buy things when there are at their highest prices and sell things when they are at lowest point,others make lots of money.

I have just given a piece of advice, if you feel "disturb" you can be free to lose, .. I make money and I will keeeping making money, it is no problem for me.

If you think gold is so good, think twice....after almost 3 decades it has reached the same peak it was before...(well, $5 more)

Do you know with inflation adjusted prices, the latest 1980 peak today would be more than $2000 ?

It is not only the buck to be affected by inflation, my friend,....think about it.

Listen to that guy, it makes sense, it really does

[Maxi101]

Time for a little Sunday night flame bait with this topic.

I'm long on gold. I've been long on gold for 3 years, and I will continue to be long on gold for the rest of my natural life. Gold increased 30% in 2007. It will continue to increase an average 20% a year for the indefinite future.

People who were trained to believe in fiat currency simply can't accept this. However, anything learned about finances in the last 30 years is completely worthless for the next 30. We have passed into a new era, and that era is energy depletion/peak oil.

Economic growth simply can not occur without exponentially increasing energy. That is one thing that doesn't exist anymore. This is an inescapable truth. Economists don't understand physics. On the other hand, a fiat currency can be inflated to infinity, and it will. Since all economies on this finite planet can no longer grow in a meaningful way, the only option to create money to pay off interest is through inflation. It's either that or else let the banks foreclose on everything and go bankrupt while stuck holding worthless assets.

Real inflation (expansion of the money supply, not the reported statistic which is manipulated and meaningless) will be on the order of 20%. People who understand this also understand that with energy depletion mining operations will become more and more difficult. Gold from now on will track the price of oil, and that direction is strongly up. The ability to increase the above ground gold supply will be constantly reduced because of the difficulty in obtaining energy to extract it. Gold is a store of wealth, and is the only "money" on the planet that can not be inflated at will by governments.

Gold has been used as money for thousands of years. It will continue to behave like money, even if most today don't like that idea.

Gold will hit $1000 this year. In the future it will hit $2000, then $5000, and on and on...At each step people will be saying it is overvalued. Somehow there will always be strange people who keep buying it, and no one will understand why. Eventually, all fiat currencies will collapse, whether Sterling, Dollar or Euro, just as every single one has throughout history. Those strange people who bought gold won't care. Gold will still be a store of wealth, and it will be redeemable in whatever rises up in the ashes.

So buy gold now. By all means try and buy at the dips, but for anyone who thinks gold is overvalued, I'm sure the buggy whip manufactures didn't want to hear about the automobile either. Fiat currencies have had their day, and they are rapidly approaching the end of their useful life. They no longer represent a store of value. Get out while you still can.

BTW, I'm not a gold bug. I'm an engineer and a scientist. The market may behave erratically for a while, but trust me when I say physics will win in the end. Barring a miracle or massive depopulation, there is no way out.

hear hear, thats sense too, doom and gloom ...

[Naam]

Finally anyone living in Thailand especially as an expat should learn something from the locals-people in this part of the world trust gold more than governments and choose to hold thier savings in it.

good advice Captain! whenever i cross my property line i am full of envy seeing these hundreds of thousands rich thai people, their pockets loaded with gold bars, looking with some sort of pity and sympathy in their eyes on me poor farang whilst they are mashing som tam, selling noodles, laying bricks, carrying mortar, collecting garbage...

those mowing my lawn, clipping my bushes and trees, driving my wife, cooking in our kitchen, cleaning our home, washing our cars must be some ignorants who don't know about the power of gold

[Maxi101]

Time for a little Sunday night flame bait with this topic.

I'm long on gold. I've been long on gold for 3 years, and I will continue to be long on gold for the rest of my natural life. Gold increased 30% in 2007. It will continue to increase an average 20% a year for the indefinite future.

People who were trained to believe in fiat currency simply can't accept this. However, anything learned about finances in the last 30 years is completely worthless for the next 30. We have passed into a new era, and that era is energy depletion/peak oil.

Economic growth simply can not occur without exponentially increasing energy. That is one thing that doesn't exist anymore. This is an inescapable truth. Economists don't understand physics. On the other hand, a fiat currency can be inflated to infinity, and it will. Since all economies on this finite planet can no longer grow in a meaningful way, the only option to create money to pay off interest is through inflation. It's either that or else let the banks foreclose on everything and go bankrupt while stuck holding worthless assets.

Real inflation (expansion of the money supply, not the reported statistic which is manipulated and meaningless) will be on the order of 20%. People who understand this also understand that with energy depletion mining operations will become more and more difficult. Gold from now on will track the price of oil, and that direction is strongly up. The ability to increase the above ground gold supply will be constantly reduced because of the difficulty in obtaining energy to extract it. Gold is a store of wealth, and is the only "money" on the planet that can not be inflated at will by governments.

Gold has been used as money for thousands of years. It will continue to behave like money, even if most today don't like that idea.

Gold will hit $1000 this year. In the future it will hit $2000, then $5000, and on and on...At each step people will be saying it is overvalued. Somehow there will always be strange people who keep buying it, and no one will understand why. Eventually, all fiat currencies will collapse, whether Sterling, Dollar or Euro, just as every single one has throughout history. Those strange people who bought gold won't care. Gold will still be a store of wealth, and it will be redeemable in whatever rises up in the ashes.

So buy gold now. By all means try and buy at the dips, but for anyone who thinks gold is overvalued, I'm sure the buggy whip manufactures didn't want to hear about the automobile either. Fiat currencies have had their day, and they are rapidly approaching the end of their useful life. They no longer represent a store of value. Get out while you still can.

BTW, I'm not a gold bug. I'm an engineer and a scientist. The market may behave erratically for a while, but trust me when I say physics will win in the end. Barring a miracle or massive depopulation, there is no way out.

hear hear, thats sense too, doom and gloom ...

[sonicdragon]

I find it very strange that people become so worked up over gold, one way or the other.

It's just another commodity.

FWIW, I generally agree with gregb, though I would stop short at making price predictions - especially short term ones.

[Naam]

I find it very strange that people become so worked up over gold, one way or the other.

It's just another commodity.

FWIW, I generally agree with gregb, though I would stop short at making price predictions - especially short term ones.

words of wisdom.

[Martin]

It is all very well being sophisticated and saying: "After all, gold is just another commodity", but it happens to be the most-trusted commodity representing a store of value.

That only works, of course, as long as that trust lasts.

However, it has lasted for many, many generations.

Gold doesn't degrade, is portable, and (being hard to find and extract) is likely to maintain its scarcity.

Paper currency doesn't degrade (unless left in a pocket that gets into a washing machine!) and is portable. But its scarcity depends on the integrity of politicians (and the the way that the American ones are allowing Bernanke to print dollars to excess reduces one's faith in depending on that!).

So it seems understandable that people get worked up about gold and have more faith in it than they have in fiat money as a convenient way of storing their savings, and that many will continue to do so.