(This was going to be a response to someone else but figured that it might be useful as a stand alone comment on the safety of gold vs the safety of cash or money markets)
Inflation is more than %4, so you're not actually earning anything. Gold, is pretty steady, so you can dollar cost average in if you think it is at a local maxima. It benefits from being immune to inflation, plus it is entering into the bull market phase.
The way I know gold is just beginning its bull market is that your percpetion that it is "scary" is very common. (and understandable) It will be scary for a long time before it becomes "a can't lose proposition that everyone has got to get into!" We are at the "Awareness" phase where it is not uncommon to hear that you should buy gold.... but it is not a mainstream investment yet.
When it becomes one, and then enters a strong bull market, people who bought now will benefit greatly from not only the inflation protection, but this additional demand.
Unfortunately, that mainstreaming and additional demand will cause prices to go very high, resulting in people advocating it from a momentum basis, which will cause momentum to accelerate and gold will lift off and become a bubble.
Since we've all just lived thru the housing bubble we should be able to identify it. That's when you get out (and no need to try and call the top, getting out early in a bubble is fine... so long as you've identified a fundamentally undervalued sector to move into.)
I would think the exact opposite of this. Gold, from my perspective, is at absolute peak hype. You have Glen Beck and a thousand infomercials selling gold to the most absolute novice of investors at this point. Everybody and their mom has heard about gold's rise in value recently and "safety" from every imaginable financial disaster.
Maybe I'm seeing things from a skewed view point, but from where I sit, gold is the absolute ultra-hyped fad investment right now.
While I'm by no means an expert, the parent is talking about people actually buying it (e.g. houses up until very recently), not talking about buying it (as, he argues, is now the case with gold).
Comments
(This was going to be a response to someone else but figured that it might be useful as a stand alone comment on the safety of gold vs the safety of cash or money markets)
Inflation is more than %4, so you're not actually earning anything. Gold, is pretty steady, so you can dollar cost average in if you think it is at a local maxima. It benefits from being immune to inflation, plus it is entering into the bull market phase.
The way I know gold is just beginning its bull market is that your percpetion that it is "scary" is very common. (and understandable) It will be scary for a long time before it becomes "a can't lose proposition that everyone has got to get into!" We are at the "Awareness" phase where it is not uncommon to hear that you should buy gold.... but it is not a mainstream investment yet.
When it becomes one, and then enters a strong bull market, people who bought now will benefit greatly from not only the inflation protection, but this additional demand.
Unfortunately, that mainstreaming and additional demand will cause prices to go very high, resulting in people advocating it from a momentum basis, which will cause momentum to accelerate and gold will lift off and become a bubble.
Since we've all just lived thru the housing bubble we should be able to identify it. That's when you get out (and no need to try and call the top, getting out early in a bubble is fine... so long as you've identified a fundamentally undervalued sector to move into.)
I would think the exact opposite of this. Gold, from my perspective, is at absolute peak hype. You have Glen Beck and a thousand infomercials selling gold to the most absolute novice of investors at this point. Everybody and their mom has heard about gold's rise in value recently and "safety" from every imaginable financial disaster.
Maybe I'm seeing things from a skewed view point, but from where I sit, gold is the absolute ultra-hyped fad investment right now.
While I'm by no means an expert, the parent is talking about people actually buying it (e.g. houses up until very recently), not talking about buying it (as, he argues, is now the case with gold).