At least the Fiend is on our side-
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Fiend Commentary
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Gold Down, But Not Out
In the summer of 1982 when the Dow traded below 800, few investors wanted to touch stocks. Despite the fact that the Dow was at levels it first traded at nearly twenty years earlier, few perceived to the Dow to be extremely cheap.
In 1980, just two years before the Dow hit bottom, gold hit a peak of $800 an ounce. Keep in mind that its peak was twenty years ago and the equivalent price of gold today would be closer to $2,000 an ounce. At that time, it would have been hard to believe that nearly 20 years later the yellow metal would be trading for a third of its price. It would have also been hard to believe that the Dow would trade nearly fifteen times more than it did at its bottom back in 1982.
I've mentioned this before, of course, but it is important to remember that perceptions can change quite drastically. At the moment, it seems as if the stock market will never go down again while it also seem as if gold is permanently dead.
Unless we are indeed in a "New Era" where fiat money (not backed by anything)will rule indefinitely, gold will rise substantially in value at some point when confidence is lost.
When confidence has been lost in the fiat monetary system, we will finally get to see the true value of gold. I will be one of the few people not surprised to see gold trade above $2,000 an ounce in the future and it will be the investment choice of the early 21st century.
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FWIW- It appears that the XAU is setting yet ANOTHER higher bottom above 62, in the face of new lows in the POG. Very Bullish. I will be adding to my position if 62 holds today.
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