If you invested a 10K in the S&P in 1985 it would be worth 60383.4974 10K in gold at 300Oz would be worth 40,666 And I am not even including the dividends payed out by SPY which with compounding would make the total return higher than 60383.4974 Gold has a negative carrying cost as well. Buying gold today is like buying gold in FEB of 1980. A Goldbug loading up in gold in Feb of 1980 (10K dollars) 10K in 1980 = 12.5 ounces (800 an ounce) 10K in 1980 in S&P500 basket = 86.92 units 10K today at spot 1220 = 15250 dollars 10K today at S&P 1105.98 = 96,131.78 and this is not including dividends or reinvestment of dividends. Infact the best time to buy into the S&P 500 is when the markets sell off and no one is interested in stocks and when gold hits peaks. High gold prices low S&P = buy S&P There is no economic sense to hold gold with its wide bid/ask prices, low liquidity and opaque price discovery(all based on hype and manipulation) S&P500 represents an investment in a basket of fractional ownership in productive assets. Longterm bearish gold Longterm bullish S&P I just want to clarify things because I am getting lots of calls about putting entire IRAs into gold etc.. from folks hearing too much on the TV/Radio about gold.