I already pointed you to the entire 2011 Bespoke Roundtable this weekend, but I wanted to break out one particular question and response that I thought was interesting...
Wall St. Cheat Sheet: If inflation hits, Gold will go blast off. People thought the “Cash4Gold” commercials were a sign of the top, BUT they failed to realize this was a sign of people SELLING gold, not BUYING in a frenzy. Our Gold & Silver Premium subscribers have made a killing despite all the bubble talk in the media.
Vix and More: Investment demand for gold should continue in 2011 and while there will be pull backs, gold is not experiencing a bubble. The metal is fairly valued at the moment and will see volatile trading in 2011, ultimately ending the year up.
The Reformed Broker: I hate gold. And I’ve been long the gold ETFs, the miners, the other precious metals, etc for 2 years now. My attitude is that I’ll stay long and ride this stuff with trailing stops. It will go up until people get bored with it. The sell-off, when it comes, will be shocking in its violence and brutality – but that may come from much higher levels.
Random Roger: As said last year, we own gold in the belief that no matter the price, if something bad happens today it would go up tomorrow. To which I would add that if gold is the best performing thing you have then chances are stocks are not doing very well. We own gold but we never root for it.
Financial Armageddon: Still very bubbly and vulnerable to a major shake-out, but my longer-term outlook remains bullish.
A Dash of Insight: I do not know of a way of getting a “fair value” for gold. This year gold prices benefited from a weak dollar, the fear of deflation trade, and the fear of hyperinflation. It seems like all three of these are at extremes, but there is a profitable market in selling fear. The commissions and margins are much better than for those of us who provide investment advice over a range of asset classes for a flat fee.
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