Are most investors not yet on board with gold after seven straight-up years?
*Barron's, by Alan Abelson, January 7, 2008:
“TALK ABOUT GREAT ENTRANCES! For investors, anyway, they don't make
them any better than the memorable one staged by that precocious
calendrical infant, 2008. That is, if you're an investor who happens to
have a portfolio chock full of gold and overflowing with oil.
The precious metal never glistened more brightly than it did last week
as it soared past the all-time peak of $850 an ounce set nearly four
decades ago. Not be outdone, crude made hydrocarbonic history of its
own by topping $100 a barrel, an all-time record high and, keep in
mind, please, we're not talking any old all-time, we're talking the
real thing: geologic all-time.
Now, we're not so cloistered or insensitive as to fail to recognize
that an absolutely humongous number of investors to their sorrow --
including not a few of those extraordinarily bright chaps and chicks
who subscribe to this august magazine -- own neither a speck of gold
nor a thimble of oil.
In that melancholy event, obviously 2008 did not begin on an upbeat
note. Quite the contrary. But, hey, don't lose heart -- the year still
has 365 other days, at least two of which, even a timid soul like us
would be brave enough to wager, will witness a rise in stock prices.
Actually, we can understand why folks, especially those of a
chronically cheerful disposition, shy away from gold. It is, after all,
the nearest thing we have to a Dow Jones Average of Global Misery. We
are a nation of optimists, and a real optimist would just as soon drink
a quart of sour milk as own something that keeps reminding him that
everything isn't hunky-dory. Then, too, for a lot of people, the mere
mention of gold stirs up painful pre-fluoride childhood memories of
having cavities filled by drill-happy dentists.
Gold's perverse proclivity to feed on bad news was much in evidence as
the gathering woes of the economy at large (think housing collapse and
the gaping black hole in our accounts with the rest of the world) and
the financial sector in particular (the mother of modern credit
crunches) provided the spark for the precious metal's combustible
performance that sent it soaring to unprecedented heights.
And it's not an accident that bullion has battened rich on the
sickening downward spiral of the dollar, which, easy to forget, was
until not all that long ago the most revered currency on the face of
the planet. The remorseless shrinking of the greenback's value has
given rise to a clutch of scary scenarios, from an inflationary chain
reaction to a kind of global Olympics in which nations fiercely compete
in a race to devalue their own coin that is destined to end with every
participant (except Zimbabwe) a loser."
*This information is solely a highlight of the opinion of a third-party publication and is incomplete. Please subscribe to this publication for the full and timely opinion of the author and call a Monex Account Representative for any additional up-to-date information. This is not an offer to buy or sell precious metals. Investors should obtain advice based on their own individual circumstances and understand the risk before making any investment decision.
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