Is gold a good investment or just a trader?

Discussion in 'Economics' started by fearless9, Feb 23, 2007.

  1. gold is a GREAT investment.

    when it's CHEAP

    i loaded gold (before i even knew what stock trading was) in 98-99.


    cause im a contrarian at heart and everybody loved stocks and everybody hated gold

    it tripled in 10 years, which aint bad for a longterm investment

    when it comes to investments, it pays to buy what people hate (undervalued ) and sell what they love (overvalued)

    this is NOT necessarily the case in trading, where value is largely irrelevant - supply/demand is the issue

    but in the long run, prices regress to the mean, and the market finds value

    gold *is* a great trader.

    but it is ALSO a great investment. with proper time frame, and buying when it is cheap
    #11     Feb 23, 2007

  2. Is it cheap now ?

    #12     Feb 23, 2007
  3. if you believe it has value in the context of a reserve currency, yes. If not, then its like any other commodity. production is limited to a relatively small amount per yr, and China is buying a few hundred TONS per yr from exporting countries.

    that doesn't mean the markets won't wipe the floor with you if you buy before the next selling spree starts.

    unless you have a beautiful cost basis, its like any other trade.

    as soon as global slowdown hits and liquidity falls back to earth, gold is just as vulnerable as anything else - regardless of inflationary context.
    #13     Feb 23, 2007