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216 Comments
- EvilDweeb, on 03/19/2009, -2/+66Silly.....gold isn't getting more valuable.....our currency is being devalued -- Fractional Reserve Banking.
Just like any freaking graph, it's not what you say, it's how you say it. - kemp34, on 03/18/2009, -9/+66Bush, Paulson and Greenspan set 'em up, Obama, Geithner and Bernanke knock 'em down...
"Bipartisanship" at its plundering worst. - Rothbardosaurus, on 03/19/2009, -3/+51As long as the Fed is making stupid investments look like good investments through arbitrary interest rates, it's possible to have a bubble in just about anything.
But gold should not be thought of as an investment. It pays no interest or dividends, and produces nothing. It is a store of value and nothing more. When gold goes "up," it is not necessarily appreciation. It is the depreciation of the currency it is denominated in. If the mainstream ceases to think of gold in this way and starts treating it like an automatic wealth machine like they did with tech stocks or real estate, you know it's at the bubble stage.
The Fed has decided to scuttle the Dollar in order to keep the party going for the Wall Street fatcats and the military industrial complex. With all the money the Fed has been printing, gold will still be dirt cheap at $2,000 per ounce. We're nowhere near a commodities "bubble" yet. This is only getting started. - pookydirt, on 03/19/2009, -1/+38Just out of curiosity... it it at all possible to have a "gold bubble"?
- robehren, on 03/18/2009, -24/+51Can't go wrong with gold in anycase. Always has intrinsic value. After Obama finishes raping our dollar and we go to a one world currency might be a good idea to have some gold around.
- Mrstupid7, on 03/19/2009, -4/+29BUY GOLD BUY GOLD BUY GOLD IT'S ALWAYS GOING UP IT'S A SAFE INVESTMENT. Hmm.... this sounds familiar.
- RonPauls, on 03/19/2009, -0/+20careful with 'value'
value is subjective; nothing has intrinsic value in technical sense - StingingNettle, on 03/19/2009, -2/+22Yes, but even in the worst case scenario gold will be worth something. You can't say that for CDO, OTC derivatives, stocks, or even treasuries.
- heynow21, on 03/19/2009, -5/+24Ooh, so now it's almost as valuable as it was last month.
- davewashere, on 03/19/2009, -2/+18Even if you could have invested in gold at $193.40 an ounce in 1978, it's still not a very good investment. If you had invested that $193.40 elsewhere and earned a measly 5% annual gain, you'd have $836 right now. If you had earned a more realistic 10% per year, you'd have $3,375. Gold is a terrible investment in the long-run.
- mdonato, on 03/19/2009, -2/+18Is this the start of the destruction of the dollar that Ron Paul and others have been worrying about?
- havek23, on 03/19/2009, -2/+164% isn't a skyrocket... Sun Microsystems's (JAVA) 81% increase yesterday morning was a skyrocket hehe
- jarjarwang, on 03/19/2009, -1/+15skyrocket = 4% increase ... ok. I will sell my gold if people actually go crazy and I can get 2k/oz in the near term.
- Risingashes, on 03/19/2009, -5/+19Gold is currently in a massive speculative bubble. It'll burst just like any other bubble.
I always love it when people say that gold has 'intrinsic value'. Gold is as worthless as US$, Euros or Yen. To state otherwise displays a lack of understanding for how the world works. - ousthouse, on 03/19/2009, -3/+16How much is paper worth?
- fromaworld, on 03/19/2009, -0/+13Gold is just a precious metal. It's only value is the value given to it by the market. There's no difference between gold, deer skins, or beaver skins. They're all just tradeable items.
- inactive, on 03/19/2009, -0/+12You're misunderstanding gold. Its role isn't as an investment, but as an insurance policy. One ounce of gold buys a good men's suit for Jesus Christ, Thomas Jefferson, and both of us. That's gold's role, to retain value despite the excesses of government "money." It's folly to expect more from it.
- glitchbit, on 03/19/2009, -3/+14Gold's value is artificially high because our dollar is artificially low. Once the dollar stabilizes the value of Gold will fall and those that sold it to you while Gold was higher will have your "low dollar value" except it will actually be worth something more than when you had that same dollar.
Those selling you Gold are betting on the US dollar succeeding and coming back to value. Those buying Gold are betting that our currency will go much lower or fail. Who do you think are economically speaking smarter? Those that own the bulk of the Gold or those that are buying the Gold?
Quit thinking short term and start thinking long term. And 2 to 5 years really is not all that long term as far as investments go. - jsffive, on 03/19/2009, -2/+13Long term, if you had bought gold in 2000, it was $250.00... In 2000, the stock market peaked at around 11,750... Has anything other commodity retained as much value in the same span of time as gold? Please tell us, so we can invest in it.
How are your stocks doing? Because, as of this morning, the stock market is ALMOST as high as it was a month ago. The difference is people aren't sure about something like GM stock, because they aren't sure if GM is still going to be around a year from now... they ARE sure about the value of gold and whether it's still going to be valued a year from now.
Why didn't you make the comparison to any other stock?
But no, people are FOOLS for buying gold, right?
Tell you what, you keep buying stocks, and I'll keep buying gold. - zomgflamer, on 03/19/2009, -0/+10it doesn't matter, so long as the dollar falls/inflation occurs it will go up. It is going "UP" but it just means your maintaining purchasing power and depending on what time you got it and come out like you mention you could make profit.
- govsucks, on 03/19/2009, -0/+9WOW, a reduction in value of all circulating currency by 1 trillion dollars. Thanks for the stealth tax Obama administration!
- inactive, on 03/19/2009, -4/+13BUY REAL ESTATE IT'S ALWAYS GOING UP IT'S A SAFE INVESTMENT.
- TreatsTheBear, on 03/19/2009, -0/+9Gold's importance to modern technology is limited, especially at these prices. Also, we can't make it, but we can mine it and it is reusable, so the supply is constantly increasing, unlike deer skins or beaver skins which eventually degrade or get ruined.
Be careful with everything. Nothing goes up forever. That's the one thing we should have learned from all this.
That said, I do own some gold and I'm glad I do. - pookydirt, on 03/19/2009, -0/+8Thanks! I was thinking, sure it must be possible.... but, then I started thinking about it in terms of exactly what you just mentioned – the inevitable (and likely rapid) decline of the dollar (among other world currencies). This is precisely what had me questioning the bubble theory. I'm still trying to work out the thought kinks in my head of that kind of hypothesis... but, thanks for the response!
- impei, on 03/19/2009, -2/+10Gold was $265 in 2001. There aren't many investments that could make a 350% return over the last 8 years.
- oboshoe, on 03/19/2009, -0/+8That just a test balloon/starter step.
There's going to be a whole lot more of this.
He may very well cut the deficit in half. But what does that buy us if he devalues the dollar by half? - Pssdoff, on 03/19/2009, -0/+8Sell your gold for what, an inflated depreciating currency?
- DrWordSmith, on 03/19/2009, -1/+8Scary how many people here write comments with the assumption that the US dollar has intrinsic worth.
There will always be a demand for "Money" so that people can efficiently exchange goods and services. The reason that Gold has historically been the people's choice as money is because it is rare, stable (doesn't rust/tarnish or break, scratch easily), fungible (can be melted down and reformed into different sizes, something that can't be done with say diamonds), difficult to counterfeit (mainly due to its high density), and more can't be created without effort.
The US dollar on the other hand is backed by nothing but people's confidence in their government and financial system. If it (and the Euro, Yen, and other fiat currencies) collapse and are worthless, people may barter and trade goods for a while, but eventually need money as defined above. And my confidence is that Gold will fit that role naturally as it has in the past several thousand years.
Stop thinking about whether Gold will be $500, $1000 or $10,000/oz and start asking "how much quality of life can I purchase for 1 oz of gold". You will then probably realize that apart from periodic fluctuations, 1oz of gold today gives the owner the same purchasing power as it did 1000 years ago. The US dollar on the other hand is worth 3 cents compared to what it was worth 100 years ago.
Finally, Gold is not meant to be an investment, any more than buying Swiss Francs is an investment. Its meant to be a means of savings, a way to protect your wealth. If you want to invest, invest in gold mining or exploration companies. They are the ones that produce the gold. - judicar, on 03/19/2009, -1/+8>Remember all those loons who told you to buy gold back when it was $200 an ounce
sorry I don't remember much from 1979 - varun1s, on 03/19/2009, -6/+13Sorry to bust a bubble, but there's nothing with extrinsic value. For example, if everyone around you is starving and thirsty, no one will trade you their bits of food and water for your american eagle gold coins.
- JTik, on 03/19/2009, -1/+8Gold is the ultimate inflation control. If you don't feel comfortable investing in stocks but don't want to lose your money to inflation, buy gold. Don't buy gold to make a quick buck. As the money supply increases (and it's doing a lot of that right now) the dollar will lose value over time. Gold on the other hand will retain its value. Gold is a hard currency, it has value itself. The dollar is a soft currency, it only has value because the government says it does and because of the number is circulation (which is always increasing). The dollar bills themselves are worth nothing.
- oboshoe, on 03/19/2009, -0/+7worth is a relative matter.
- JigoroKano, on 03/19/2009, -1/+8When simple interest gets back to being more than the inflation rate, the gold bubble will "burst" so-to-speak. But it's not going to crash like Zimbabwean dollars or anything.
Investing in gold is really just investing in inflation. The interest rates are low right now and government is spending like mad. Once the economy picks back up, gold will go back to being a terrible investment. - tao52nyc, on 03/19/2009, -2/+9And if the average rate of inflation was 4% over those same years, you only really received a 1% gain, in terms of actual purchasing power. People see those big "compound interest" numbers and are intoxicated by them, because they don't factor in the bigger picture of the inflation tax.
- inactive, on 03/19/2009, -2/+9Gold doesn't have much intrinsic value, oil would be more valuable. It's a readily used resource much more than gold. In fact gold is one of the most stupid things, we pay someone to dig it up then pay someone else to dig another hole and then pay more people to guard it????? It's a great electrical conductor though, so I guess it has some value like making wiring or computer connections.
- deema1, on 03/19/2009, -0/+6We are so f*cked.
- RealmDown, on 03/19/2009, -1/+7Yep, how they say it is how they want you to take it, and they are masters of spin.
Would you rather have a nice, tender, juicy steak, or a segment of muscle tissue from the corpse of an immature castrated bull? either way, I'll have mine medium rare. - rahsut, on 03/19/2009, -0/+6currencies and commodities don't move that drastically, sun microsystems is a small company compared to the size of the gold market. thats why 4% is considered a skyrocket
- marcusbrutus, on 03/19/2009, -0/+5Very Misesian, well done sir.
- tao52nyc, on 03/19/2009, -1/+6But as a hedge against inflation, gold retains its VALUE over time in a way that's disgustingly stable. Gold prices right now reflect more the worth of the currency used to purchase it than the value of the gold itself. Gold, in constant dollars, has much the same purchasing power today as it had 100 years ago. OTOH, Something I pay $1 for today my father paid 15 cents for in 1966, and my grandfather paid 3 cents for in 1912. That's change you can believe in.
- ,,|,_, on 03/19/2009, -5/+10Great, another commodity to exploit and inflate beyond reason... and don't give me that intrinsic value *****. It's a shiny thing you dig out of the ground.
- mjk340, on 03/19/2009, -0/+5I was going to post this if no one else did. Houses are also durable and have intrinsic value. That does not make them immune to overvaluation and speculative bubbles.
We all know how susceptible the markets are to 'sentiment' and how often they ignore fundamentals. There are a lot of people who believe gold is safe and want to dump their money into it regardless of cost and their belief is reaffirmed by the fact that the price is going up "endlessly". - dacrazydude, on 03/19/2009, -0/+4I wouldn't recommend buying gold now. I bought gold near the 350 an ounce mark.I think it's very risky to purchase gold at this point.
- Licurgo, on 03/19/2009, -1/+6yes
http://farm3.static.flickr.com/2121/2034744979_4b0 ... - akhomestead, on 03/19/2009, -2/+7Of couse, and the dollar, which all it takes to create is a pinky hitting the print button, is worth so much more.
- mikemil828, on 03/19/2009, -2/+7I don't get diggers. It's pretty obvious that gold is in a speculative bubble at the moment and one day the prices on it are going to tank. After seeing what happened with the Tech bust and the Real Estate bust they'd be more careful, but nooooo...
- dmbchris, on 03/19/2009, -2/+7The only safe way to gain from this is to sell any gold you have. Gold is NOT an investment- it is a temporary hedge against inflation at best. It has hovered in the same price range for the last 100 years. If you really want to INVEST in gold, do it in a gold mine. They are sitting on mountains of gold, waiting to flood the market just like the fed just did today.
- inactive, on 03/19/2009, -2/+7NachoBusiness... Taking the subtlety out of jokes since 6 minutes ago.
- inactive, on 03/19/2009, -0/+5Don't blame me, I voted for the other douchebag.
- ARTLUKM, on 03/19/2009, -0/+4Gold does not provide warmth, shelter, nourishment, transportation, nor is it a tool. So it doesn't have any intrinsic value. The only reason it has value is because people have agreed to recognize its value. Four-leaf clovers are rarer than gold, but you don't seem them going for $920 an ounce.
There will also come a day when gold can either be created synthetically using nanotechnology or mined in space. So yes, gold has a pretty stable supply today and is useful in a number of ways, but it does no have "intrinsic value." -
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