Gold!!!!

[yellowecho]

Originally Posted by yellowecho

bump- what are your thoughts now that it has peaked $1200?
i'm guessing this is a direct relationship with how unstable the stock market has been?
or does it have to do with the diminishing value of the dollar?

Bump?

[Guitarnotsoguru]

Unload it now!

[scottl]

Thought I would quote my utterly correct comment from last year. Since then my pick is up another 30 to 40%. Gold is where? The same?

Sell the gold. You lose money just holding it. It returns nothing to you.

Originally Posted by scottl

I agree with Luke. Historically, gold is one of the worst performing investments. It does well in cycles. The recent move pales in comparison to the money that was made in many other asset classes. If you played the debt markets you would have doubled to tripled you money in the last 9 months. Gold is up 20% or so. You received 15-20% interest on those debt investments AND made 100-200% return on the principal.

My favorite asset class, the midstream energy pipelines, are up 70% YTD. And they pay out huge cash flow. Something gold does not do.

Gold, at this price, is for suckers that buy into the hype. IMO of course.

[JamesT]

What is a midstream energy pipeline? Thanks

[Curt]

Originally Posted by Timinator

Buy low, sell high; not the other way around.

Now you tell me!

[yellowecho]

Originally Posted by Bryan T

How does the price of gold compare today to when this thread was started?

then: $1050
now: $1250

[PlatinumRoom]

I just had my gf sell ALL of her gold jewelry on Friday. The price is only going down from here.

[JamesT]

Why did she do that no one buys jewelry as an investment, they buy it for fun, and I do think it will go up some.

[scottl]

Err... Actually on 11/19/2009 the price was $1135. Now it is $1236.

This means that gold has underperformed probably every major index by a long shot.

For example, the Alerian MLP index (the pipelines I keep recommending) was at 262 on 11/19/2009. It is now 323. and importantly, you received the February, May, and August distributions. Based on the November yield, this is about another 7%.

Lets compare.

Gold gave you a total return of 8.89%, not including acquisition cost and custodial fees to store (or shipping and insurance if you bought). Plus you only make the % if you sell!

MLPs gave you a total return of over 30% with 7% or so being cash flow into your pocket....now.

I could list 10 other indices that destroy golds returns.

Originally Posted by yellowecho

then: $1050
now: $1250

['70 RS]

Scott,

One major problem with your analysis:

You are talking about investing money in hopes of a greater return.
The people dealing in gold are investing in an irrational fear marketed by scam artists.

It happens every time there is a financial downturn.

[claudel]

I still have my grandfather's pocket watch.

Does that count?

[yellowecho]

Originally Posted by scottl

Err... Actually on 11/19/2009 the price was $1135. Now it is $1236.

Err today it's at ~$1245
My bad with 11/19. I was looking at a day prior when it was priced at $1149.
Errrr.... technically.

[Fons]

Last year november a budy bought 10 Guilder golden coins for € 159, each. The same coin can now only be bought for € 204,- When he sells these coins he now gets € 35,- more for each coin.

He bought for € 10.000,- Great return I would say.

[germs]

not ashamed to admit that while i do have SOME solid gold jewelry in heirloom pieces (as well as my wedding band, etc) most of my owned gold is tied up in various cable tips.

NO, i'm nowhere near 5% of my net worth.

[A. Tad Askew]

Fellow TGP'ers,

There seem to be a lot of numbers floating around this thread regarding the performance of different assets. Since we're starting a new month, let's go back and do a year-over-year comparison:

9/01/09 9/01/10 Gain/Loss(%)

Gold $960 $1245 29.68%
Dow30 9310 10269 10.3%
S&P 500 998 1080 8.21%

scottl, congrats on the performance of your MLP's. That's a great return by anyone's standards. Energy has been a core position in my porfolios for 20 years now.

The following 4 stocks were in my account 1 year ago and for the most part, I still own them:

9/01/09 9/01/10 Gain/Loss(%)

SLW 9.79 22.51 128%
GG 36.13 43.41 20%
AUY 9.03 10.08 12%
BEXP 7.51 16.10 114%

The point is, despite some claims here to the contrary, gold has been one of the best places to have your money over the last 1, 5 and 10 year periods! To claim otherwise is to be ignorant of the facts.... Has gold underperformed the stock market since 11/19? Yes. However, that doesn't take into account the 26% move gold enjoyed from 9/01/09 to 11/19/09. That's a pretty sweet move! If I cherry-picked 4/27/10 as a starting point for the Alerian MLP Index, those numbers would disappoint as well.

http://www.kitco.com/charts/popup/au0365nyb.html

Thank to all for your comments on this thread. I appreciate all your comments.

All the best,

Tad

PS. None of the above should be construed as an offer to buy or sell securities.