If you read back through the history, you won't find me saying gold won't go up in price. In fact, my predictions of what gold would do in terms of price have been accurate to 4 significant figures.
Of course there are speculative manias with I AM A MINDLESS ZOMBIE mobs crowding in to the latest get rich quick speculative zero sum game gamble.
Most people are too young to remember, or were busy doing other things at the time, but the gold mania from 1971 at $35 per ounce to $800 per ounce less than a decade later was a greater leap than what we have seen since Y2K from $280 to $1700. I watched gold then trickle away for 20 years which was a long grind for those who bought in at the top of the mania. They had to wait 30 years to get back to the previous peak. 30 years is quite a long run and in the long run many of them are dead.
Newbies are now panting over their wondrous discovery that when governments destroy fiat money, the price of other things, especially "safe" investments go up, some in spectacular fashion if they are the focus of speculative mania. Plus ca change.
In the long run, gold is just another boring piece of a decomposed star sitting in the earth's crust to be used like the other elements of the periodic table for its particular characteristics. The Moai maniacs will learn that harsh fact of life, again, sooner or later, when the mania has run its course and reality dawns as surely as the Biotelecosmictechdot.com crash of Y2K which I had also been ranting about every month from May 1999 when it became very obvious that we had indeed gone soaring into the vaunted Irrational Exuberance zone.
The breathless hysterics of the gold mania are starting to sound like those of the "this puppy is going to da sky" crowd of the 1999 mania.
When the new world currency is introduced, gold will suddenly look so last-century and the repeat of the long decline will create a whole new swarm of sadder but wiser "investors". TJ's gold profits are part of a zero sum game. There is no wealth created with digging up gold. It is literally sunk cost, deep into the ground, to get the stuff out and again deep into the ground to stash it in a bunker somewhere else. Digging a hole to get gold out and building a hole to put it back in is very amusing as a wealth creation process. It seems like a good idea at the time, just like "Houses never go down in price" seemed like a good idea at the time and a great hedge against dilution of the dollar, especially when interest rates were so low after the Biotelecosmictechdot.com bust when our great and estimable idol Alan Green$pan KBE cut interest rates to low levels for such a long time.
I rang the bell at the recent peak and sold a load of gold, and then bought a whole lot at the recent low. I'll ring the bell again when it's time for everyone to sell to the last sucker in. Hopefully the last sucker can afford to buy the whole lot or a lot of people wanting to escape will find there is no bid for their stash of glittering fool's gold. Glittering eternal gold at $800 per ounce declined over 20 years to $280. TJ was busy drinking beer and chasing girls and didn't notice.
Here is a graph and commentary about the price of gold in the good old days of a third of a century ago [which for some weird reason seems like yesterday] bullnotbull.com
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