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Strategies & Market Trends : Value Investing
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To: Madharry who wrote (40933)1/4/2011 6:05:48 PM
From: Spekulatius3 Recommendations  Read Replies (1) of 78462
 
My posts are always opinions. If the amount of money were equal to the value of precious metals, then that would return us to the gold standard. I don't think the argument can be made that the wealth generated by the world economy is proportional to inventory value of a few elements (Au, AG) horded in safes. This was what the gold standard was about.

Now I am agreeing with you that we are on the wrong track with QE's and such, but my argument is that there is not fundamental reason for the rapid appreciation of precious metals.
In the 70's we had high single digit or even double digit inflation and now we are a far cry from that. I remember the 1980's gold boom I played it as a 14 year old with 2 British Sovereigns. It was my first speculation. Back then, you had to buy actual coins (which you could do at the bank for an about 8% commission in Germany) now you can just buy GLD with a mouseclick. This makes it easier to get in and easier to get out.
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