Comments on: Why I will probably never buy gold

By: ALEX

ALEX — Fri, 06 Nov 2009 00:13:22 +0000

Look the fact of the matter is that gold has gone from 250/ounce in early 2000 to over 1100 now! Thats clearly not a return of 1%/year… its a lot more…and 10x that amount if you were a speculator and bought it as a futures trade.

By: Carnival of Personal Finance #229: candy edition — the centsible life

Carnival of Personal Finance #229: candy edition — the centsible life — Mon, 02 Nov 2009 17:39:18 +0000

[...] Why I will probably never buy gold: Mike shares that gold is generally a bad investment, and why he will never buy it. [...]

By: Doug Digger Eberhardt

Doug Digger Eberhardt — Thu, 22 Oct 2009 14:55:45 +0000

Mr.GoTo,

I’ve been replying to gold articles for quite some time. You are the first person to ask that question. I give you credit.

My book will answer that question for you. I’m releasing it on Amazon soon. I’ve been selling the book for $97 at present but am lowering the price to the $20 range, combining it with my silver book. I just want more people to understand what’s going on.

In a few weeks or so, Google “Amazon” and “Buy Gold and Silver Safely” and it should be there.

Disclosure: I don’t sell gold. I write about it. I was a financial advisor who left the business to criticize it as well as take on economic and political issues of the day.

By: Doug Digger Eberhardt

Doug Digger Eberhardt — Thu, 22 Oct 2009 14:50:23 +0000

The dollar index has been approaching its all-time low of just under 72 and gold broke out to a new high. It’s not rocket science.

Since 2000 the gold/dollar dynamic has changed. Just look at the charts.

Could we get a bounce in the dollar here and a fall in the price of gold? Sure. I wrote an article explainging why on my blog http://fedupbook.com/blog called “Is Gold Peaking For Now?”

The dollar index hasn’t broken its March 2008 lows and until it does, gold shares are a risky trade at present. Nothing goes straight up or down eh?

Will the dollar index at some point break below 72 again and gold break out to new highs? You can “bank” on it.

By: Stew

Stew — Thu, 22 Oct 2009 05:30:28 +0000

CCC, maybe I wasn’t clear, my point was not that an indirect purchase of gold was a bad investment. It might be a good investment . . . but as a hedge against an economic collapse, ETF’s probably aren’t going to do much good. IMHO

By: ZP

ZP — Thu, 22 Oct 2009 05:26:02 +0000

I am happy to have gold instead of dollars, and you?

By: Credit Card Chaser

Credit Card Chaser — Thu, 22 Oct 2009 02:36:39 +0000

Why is it that you say that if you did ever want to buy gold you would never buy it indirectly? If I wanted to buy gold I would probably lean towards some kind of ETF that tracks gold prices rather than going through all of the hassle of buying physical gold.

By: Gina

Gina — Wed, 21 Oct 2009 15:57:35 +0000

I totally agree w/you Stew, for the reason you mention …

“Gold cannot be eaten, it cannot grow food, it will not cure disease, it cannot provide transportation by itself.”

By: Mr.GoTo

Mr.GoTo — Wed, 21 Oct 2009 14:34:22 +0000

I agree. Gold speculation is based on fear and supply and demand. If the price goes up, the supply will increase (more mining) thereby depressing opportunity for further price increases. I have asked this question repeatedly of gold speculators: How do you know when it’s time to sell? No one can give me a straight answer.

By: Mike

Mike — Wed, 21 Oct 2009 13:14:07 +0000

Gold, as many other resources is the object of pure speculation. The funny things is that it will only protect your money from inflation over a long period of time but will never do any other good.

2000 years ago, a ounce of gold was enough to buy a nice costume for a ceremony. Today, an ounce of gold (worth about $1000) is still buying a nice suit or a nice robe. So if you want to protect yourself against inflation without living the fluctuation in the price of gold (going from $1000 to $900 and come back to $1000 in the same year), you are better off with real return bonds that offer more security, less volatility and an inflation adjusted yield.