Posted on 12/28/2006 10:28:20 AM PST by shrinkermd
That's correct. As soon as I notice a bargain the pros have already been there a day ansd a half.
Then how do you explain this:
http://www.marketwatch.com/news/story/contrarians-betting-gold-outperform-equities/story.aspx?guid=%7BBD202A60%2D503A%2D471C%2DAAF5%2D59A951E64E61%7D
According to Hulbert's newsletter surveys, the pundits are very lukewarm on gold and the "contrarians" are buying it. Opinions and noses.
The "cheering" in this article is from the fringes. First, CNBC needs to stop talking about DJII 15000 and FOMC rate cuts. Next, you have to recognize at least two "gold bugs" of this article's caliber by name. At that point, the gold rush would still be nowhere near halfway done, price-wise or time-wise.
If either was actually able to predict the future like they claim, they wouldn't be working as they would have already made billions on their predictions.
Simple answer: You don't.
Gold is a wealth holding exercise, not an expansion thereof. It is what you 'bank' as safe, as opposed to investing in the stock market. The market can reap great rewards, or great losses, but gold is a conservation play.
That is why placing all your eggs in one basket will get you burned. All gold? You will lose to the dynamic market that reaps rewards based on risk. All risk? You have the unfortunate postion of losing large sums in an ill advised stock holding, or general failure of confidence. It happens from time to time.
So, while some gold will help in the long run, it is something that can only be used as a fall back position. It is the true definition of money as defined by the Founders, so is the safe play. But safe is also not the name of todays fiscal game. Have some safe plays, but don't neglect the capital producing segments. They will reap the true rewards overall.
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