YAHOOO! GOLD GOING TO $600

[dakra]

RAH RAH RAH, GOLD!

 

I don't know about you but some of the messages I see about gold, I liken to the stock market a few years ago. When a stock was doing nothing, no one would recommend it. Yet when the stock was 2x it's value, everyone was recommending it. Yes, Gold is at a 7-1/2 year high and the gold experts are doing a great opportunity trying to hype it to you. While you get suckered in to buy it, they are selling it. The people who get hyped into buying it are inevitably going to be left holding the bag.

 

The basic premise of "investing" is buying low and selling high. Why would anyone buy gold at a 7-1/2 year high? In my experience in investing, why would you want to buy anything that is at a "7-1/2 year high"... you would rather buy something at a "7-1/2 year low"

 

and as RoadRunner said "Welcome aboard Mr. Russell. If your message gets through to just one or two more people out of the 11,000 reg users on this site, it will have been worthwhile. "

 

Gosh, I'm feeling the opposite. If I can convince one person that they shouldn't be weiry of getting caught up in the Gold hype, my job is done. Why not buy silver at $20/oz like they did in the 70s'/80's?

 

-Dave

[jtryka]

Dave,

 

While I appreciate your rant, and I agree with some of your points, there are some logical flaws in your argument. First let me say, I agree with your cautionary words on all the "hypsters" on gold of late. Certainly if you invest your hard earned money based on e-mail and internet hype, you deserve what you get. Second, no matter if you think this is all hype or not, as a prudent investor it's usually wise to have some of your portfolio invested in commodities or commodity related stocks, along with equities in a variety of industries, bonds, real estate and cash. Certainly that "insurance" due to diversification would have served many people well as the tech stock bubble burst. Your point about investing at a 7 1/2 year high is pretty much irrelevant. If everyone based their investment decisions on that logic, the Dow never would have broken 1000, and instead would be hovering continuously in a range of 30-900. But like all investments, sometimes they do make new highs. Investing at this current high may seem dumb if it goes right back down to $270, but if it goes up to $500, then passing up a 25% return seems pretty dumb. If you really beleived your position, you should right now be shorting the Dow until it gets back from 9,000 to where it should be (wherever that may be), and then we'll talk again after the bankruptcy hearing at the cardboard box you'll be living in. Remember, it's at a 7 1/2 year high, but on the flip side, it's still 55% lower than it was 24 years ago. Do your own homework, I've done mine, and based on the current macroeconomic environment, metals are a much more compelling investment than they have been for quite sometime. For some, gold is a barbaric relic, for others it's a god, and for people like me, it's one piece of a balanced portfolio.

 

By the way, for disclosure purposes, I own less than 2 oz. of gold bullion, my investment in gold is primarily producing gold mining equities.

[dakra]

Sorry but everytime I see anything getting hyped, I get the strong desire to play devils advocate. I've seen too many people getting caught up in the hype of something that appears to be "Hot" and end up losing money because it suddenly cools off.

 

My Dad bought Silver high because it was being sold to him as a sure thing. I, myself got caught up in hyped stocks when I first started to invest.

 

The economy is doing better than it has been and there is no reason for gold to go to $500+ unless something major happens. Until the economy fully recovers, I'm sure gold will get milked for all it's got.

 

Personally, I've seen many stocks that are undervalued, it makes me wonder why someone would want to take a chance with Gold at this point. I'm not against Gold but I think people should use their smarts before deciding whether or not to invest in it at this point.

 

-Dave

[jtryka]

I can't say I blame you for getting worked up, you have good reason. But it's just like the other scams that filter to my junk mail box every day promising a quick payday for no work. In my experience, anytime someone tells you it's a sure thing, just walk away, which I am sure you wish your father did. And while I agree with you on the economy improving, I tend to view gold as another currency, and as long as we see continued weakness in the dollar, gold looks promising, just like the Euro and Yen. When I look at the weak dollar, low domestic interest rates, and increasing demand for gold in China and India, I see every reason for gold to get to $500, you obviously see something different, and that's ok. I just don't want you to make the mistake of lumping everyone bullish on gold with all the scammers out there.

[Oldtrader3]

Russia is still mining and or selling about 70 million ounces (I believe) of gold per year and still needs FX (Foreign Exchange). As long as they are selling strongly into the markets with Canadian and S. African gold mines still hedging long term profits, I don't see really strong moves in gold. Only those moves driven by currency values.

[GDJMSP]

Only those moves driven by currency values.

 

But that is the point. The move gold is making is based entirely on currency values. And as long as the US Govt. keeps forcing the devaluation of the US $$ in order to be more comeptitive in the world markets - gold will continue to go up. Just as our dollar continues to go down. And to be truly competitive - it's got quite a ways to go.

[gmarguli]

There is a part of me that just loves seeing people buy into the hype. I have to admit that I LOVED watching the internet stocks sky rocket. Listening to all the people about the "new economy" and "new valuation methods". When they came crashing down and all the "gurus" were crushed, I really enjoyed it. It's just something about people getting what they deserve that makes me feel so good. I know, I'm a [!@#%^&^].

 

Gold is no different. We have a lot of people who couldn't figure out how to make money in it the last 20 years, but all of a sudden they are experts. When gold sat at under $300 for years they were no where to be found. Now that gold is on the rise, they are experts. Anyone who wants to buy gold at $400, I say GO FOR IT! After all, we've only had a few gazillion reports over the past 20 years talking about how gold is going to hit $400 or $500 or $1,000 or more. If you wait long enough, they might actually be right. Of course, if you wait long enough those who predict the sun will extinguish itself will also be right...