Originally Posted by
Skol
Well skid, look at history, the last time gold spiked exponentially was about 1979 and it subsequently crashed. Did it recover, yes, temporarily followed by the major decline. Goldbugs will say "it's different this time" and there's always differences, but the final result is always the same in any vertical spike.
Goldbugs should be used as laboratory rats in a financial behavioural psychology experiment. It's well known that people persist with scams and huge losses even though there's overwhelming evidence that they should exit the trade or the scam. We all might learn something.
Goldbugs worldwide swear black & blue that they're right and everyone else is wrong even though it's coming up 2 years since gold peaked. It's an exercise based on hope more than anything else, but they argue it's not their fault, it's Bernanke's, the Fed, the ECB, the Rothschilds, the banksters. They are betting more than investing. They argue there's manipulation and gold suppression even though there isn't a shred of evidence to prove it and never has been, and just recently JP Morgan won a court case against losing silver investors that alleged JPM had been involved in manipulating the price.
Another flawed argument is that gold is somehow 'special', the '5000 year store of value' which is actually a fallacious assumption. Historically gold is a lousy long-term bet, it's a commodity, the price fluctuates just like pork bellies, lead or feeder cattle, but goldbugs seem to have attached a great deal of importance & emotion to the metal. I even read posts from goldbugs occasionally who admire and polish the stuff, vowing never to part with it, they're keeping it for their dotage or something, but their dotage might be poverty-stricken if they're not careful and overexpose themselves to gold which to me is nothing more than shiny metal.
They could have made a lot more money putting it in cash, term deposits, property or almost anywhere else.
Equities go through the roof but diehard goldbugs hang in there losing money hand over fist. Since gold peaked, it's down by 18%, the XJO is up 25% and the DJIA is up 33%.
In the meantime goldbugs bang on about the same recycled stuff, USD crash, euro crash, debt, we're running out of gold, Portugal, the now long dead Cyprus drama, Jim Sinclair's loony predictions, full moons, King World News, Fort Knox is empty, yadda, yadda, yadda.
A psychologists dream come true.