The Rush to Gold. Coming or gone?

I like gold right now as well. Ever since the tech boom, investors have become enamored of capital appreciation, but I tend to agree with Richard Russell that you should first seek return of principal, then income, and finally appreciation when selecting securities.

Something to consider when looking at buying into gold is that when the dollar is strong gold goes down as well as other commodities. But when we are in recessionary times energy goes down as well as commodities that are used in manufacturing like copper. So if you put your money in treasury bills while the credit markets remain tight and while the market continues to fall, then you can buy gold and silver when the price hits 2007 low prices. That is one strategy I'm employing. I don't see gold going up yet. I will buy when gold is $650 to be safe.

When do people learn? When it is to late. I jumped into Gold MF years ago when the Dollar took over as the world currency,Gold sank to a new low at that time. I just let it ride and ride. That One Time investment is up over 800% today. Missed the boat but never to late.

I expect gold to pick up as it does whenever there is mayhem. That is with the caveat that this is a western tradition. There is no particular logic to fleeing to gold when the markets get rough, other than that it is a convention. A big difference from prior collapses is that investors from other cultures might not automatically adopt the same convention. It isn't obvious. If the economy goes down the tubes, what are the things that everybody will still need? Food is obvious. But gold?

It will be interesting to see if this market crash follows the historical precedent.

Historically, whenever there has been a global collapse of financial confidence the rush has always been to gold. This time won't be different. Study the price of gold relative to inflation and then find any other commodity as cheap as gold. If you find one and it is one that isn't driven by the economy like copper please let me know. Gold at these historic prices has unbelievable value.

It isn't as hard to imagine as it use to be but just imagine that General Electric files chapter 11 next week because they cannot roll their commercial paper and the US Treasury just couldn't get the back stop authorized in time. If GE fails no one will care anymore that Goldman and Morgan were also taken over the same day. On that day everyone will want gold. Everybody knows that if you have gold at least you know that you have something. I think you buy gold (even now) and sell everything else that has any leverage at all.

Gold and gold mining picks are risky because a) hedging against dollar, b) recent prices are too high, but considering the global recession gold has a limited place in your portfolio to balance it out.

you really have to be able to hold on for the volitility