Gold...what's the deal?
I met a few people last year that were stricken with a very human (and very real) condition known as gold fever. They were passionate, earnest, and very serious about their belief that gold was the only thing that investors should be buying.
What is it about gold? Why isn't foil more valuable? It certainly has more uses. Why do people like yellow shiny stuff? What is this obsession? I can't feel the same about gold that most people do. I'm not a big jewelry fan (it's not the kind of real estate I prefer). To me, gold is okay, I guess. It's metal. It's shiny. It's pretty. To others, it's precious. Pressssssshhhhusssssssss! I find it strange--strange!--that people are so enchanted by this metal; the attraction seems so primordial, so animal.
Everyone that has gold fever has their reasons for buying it. If people are buying gold as something that could be used in lieu of currency in a crisis situation, I'm not sure that walking around with a bunch of gold to buy water, money, or medicine would really work out if society was falling apart. Sounds dangerous. It also sounds like a stockpile of antibiotics might be much more valuable.
If people are buying gold as an investment, they need to consider that its value is connected to retail prices indirectly. If you take into account that the price of an ounce of gold has roughly equaled the price of a really nice suit throughout most of the 20th century, the fall of the Men's Warehouse (MW) stock last week might be an indicator that the price of gold might be coming down. Or maybe its value is only the cost of labor to dig it out of the ground and melt it into a pretty coin or a ring, but the cost of that is going down, too. It's rarely used in durable goods. Mostly, its value comes from the retail value of jewelry, a luxury item. Folks seem to be cutting back on the purchase of luxury items of late.
It is possible that the purchasing pandemic that is gold fever may have finally broken. But as long as humans have a need to possess shiny metal stuff, there will be a market for gold.
What is it about gold? Why isn't foil more valuable? It certainly has more uses. Why do people like yellow shiny stuff? What is this obsession? I can't feel the same about gold that most people do. I'm not a big jewelry fan (it's not the kind of real estate I prefer). To me, gold is okay, I guess. It's metal. It's shiny. It's pretty. To others, it's precious. Pressssssshhhhusssssssss! I find it strange--strange!--that people are so enchanted by this metal; the attraction seems so primordial, so animal.
Everyone that has gold fever has their reasons for buying it. If people are buying gold as something that could be used in lieu of currency in a crisis situation, I'm not sure that walking around with a bunch of gold to buy water, money, or medicine would really work out if society was falling apart. Sounds dangerous. It also sounds like a stockpile of antibiotics might be much more valuable.
If people are buying gold as an investment, they need to consider that its value is connected to retail prices indirectly. If you take into account that the price of an ounce of gold has roughly equaled the price of a really nice suit throughout most of the 20th century, the fall of the Men's Warehouse (MW) stock last week might be an indicator that the price of gold might be coming down. Or maybe its value is only the cost of labor to dig it out of the ground and melt it into a pretty coin or a ring, but the cost of that is going down, too. It's rarely used in durable goods. Mostly, its value comes from the retail value of jewelry, a luxury item. Folks seem to be cutting back on the purchase of luxury items of late.
It is possible that the purchasing pandemic that is gold fever may have finally broken. But as long as humans have a need to possess shiny metal stuff, there will be a market for gold.
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