Gold Officially a Bubble?

Gambit

Gambit

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Nov 21, 2011
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Nomad
So I was flipping through channels on TV today and stopped on the Home Shopping Network. The lady was selling a gold necklace. She says that the necklace itself wasn't even a big deal. She said to buy it because the price of gold is soaring. She then went on a 5 minute rant about gold prices talking like she some major stock broker. You could hear the cameraman in the background laughing at her like shes crazy for going so off topic.

But that's when it hit me...

Gold is officially at it's peak.

"Be fearful when others are buying. Be buying when other's are fearful."
-Warren Buffet

"The sign of a bubble is when your mechanic is telling you to invest in a stock and is seeing 40% returns."
-MJ DeMarco

Thoughts
 


IMO it all thepends on the road the world is going to travel in the future. If money printing continues and goes rampant the next time there is a 2008 scenario (just a matter of time) then you want to own gold because politicians can't depreciate it and physical gold has no third party risk.

On the other hand if politicians are forced to stop money printing because the idea is met with too much opposition then we will probably will see a deflationary depression and gold and silver might go down a lot.

In either scenarion you don't want your cash to be in a bank in electronic form. Get physical cash or physical bullion, preferably both to cover both scenarions.

There's also a third scenario that I see...

We could have something like 2008 but more drawn out, meaning that because of opposition politicians maybe won't be able to respond immidiately with money printing like they did last time. They may have to wait for things to turn really bad before they can get enough support for it. So you could see first a longer drawn out deflationary period that then is followed by inflationary money printing again which may cause gold to tank at first, but then shoot up like a rocket again later.
 
student loan debt is the new gold. lol. probalby safe to bet the govt is gonna bail out all those people who got philosophy degrees.
 
Obviously gold is only short term. Now the $ is in demand and a few stock markets will pick up, eventually gold will fall. Of course, by mid March next year recession will kick in, America will get unemployed and cause bifurcating troubles for the rest of the world, so gold will pick up again. Seems to me that only China is doing the smart thing of pegging their currency, DD and SS are taking a beating
 
Gold is a bubble, you don't want to buy it before another 1980's style gold crash happens again.

In recessions, people buy gold, the worse the recession, the more demand for gold. The more demand for gold, the higher the prices and therefore there is an inflationary effect on gold. Inflationary effects always crash markets when they become extreme, all it takes is a little "pop" of confidence in gold and the whole bubble bursts.
 
How many of your friends and associates own more than 5% of their investments in gold? Gold is nowhere near a bubble. Sure there will be consolidation but that's only to wipe out the lemmings.
 
LOL, it'll take a lot more than HSN pushing some crappy gold necklaces to make it a gold bubble.
 
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