so you're saying 20 years isn't long enough of a run? it just seems that in that long of a time frame price usually finds value.

and as far as currency vs gold i would usually expect the commodity to continue gaining because inflation is a fact of life (and at low levels it is definitely fine.) that doesnt mean im rushing to buy gold at 1100. our last 60 years have been very very prosperous and inflation's been with us most of the time (and $9 today = $1 60 years ago.)

here is some good reading

http://greenbackd.com/2009/11/18/cha...riced-in-gold/ and this links to
http://www.economist.com/blogs/butto...ext_bubble.cfm

No, not when you're cherry picking the years and data to get the result you want, in most cases 20 years is enough, for instance if you take present price and go back 20 years you see what i am saying. In fact hand select ANY date you want and end it with present prize of gold and what i said is true.

You can play the cherry pick game with any asset, doesn't mean you're making a valid point.

again just because there is inflation it doesn't mean that gold is a good investment at $1100 / share. and i have no idea why you guys throw around "fiat currency" like its some horrible thing. whatever.

my question still remains under what circumstances does gold not go up in price when you print more money? or does it always go up in price then no matter what? seriously, i'm wondering, what do you think? japan's printed a bunch of more money in the last 20 years and they just can't make that happen.

i remember early this year the head of the st louis fed and some other economists were talking about how they were seriously concerned about a looming japanese-style deflation, how could this happen if we printed a bunch of money? are they just stupid? do they not read mises.org or what?

i seriously dont know the answers to these questions, but i'm interested in what the gold bug answers would be.

X10

Buying and holding US stocks which have produced one of the best track records in history over the past couple centuries even is flawed unless you live to be over 100 yrs old or time the cycles. Not to mention survivorship bias.

Dow Jones Index 1900-2006
http://i45.tinypic.com/143dwkx.jpg

Like I was saying I think once one gets past the idea of a perfect investment vehicle they might figure out how to time them better.

It may not be a great investment at $1100, but even with the current price i would still say gold is better than holding dollars(interest included). If you have a more advanced investment strategy for today's volatile markets, well congrats. Most of us aren't advocating investing in only metals.

Many of us don't like fiat money because we think the market would do a better job maintaining a currency than politicians or the central bankers and their government protected banking cartel.

Not sure anyone can answer this with certainty. I would say in general if currency and easy credit is being expanded the price of gold will eventually increase vs said currency. But you can still have deflation even when monetary forces are doing inflationary things...

So according to you there are 2 options: gold or dollars? Well in that case I'd buy gold (not at these levels tho) because gold will probably outperform. But that's not the case as there are hundreds of other places to put your money.

The choice is not dollars or gold, the choice is gold or stocks, bonds, real estate, life insurance, CD's and what not. So please stop comparing the dollar ("OMG $1 today is worth $100 dollars 100 years ago") to gold when that's not the choice you have to make.

Some people don't feel comfortable or have the time to do the research and invest, they feel much more safe just saving money. It would be nice if someone could save money for 10-20+ years and not have it devalued by 4-5% every year

Except for the fact that gold has industrial uses in addition to it's value in jewelry form, and that it's a finite resource.

If that's your argument, then all assets are an MLM-scam.

No, because a bond or a stock certificate will generate income. Even if there is no buyer to be found it's worth something to you because it will pay you (and in that case there will automatically a buyer, if the price is right).

Quick question for you precious metals guys: My understanding is that gains from gold and silver are taxed at the 'collectibles' rate of 28% not at long-term cap gains rates. Is that true?

It's not that easy and it shouldn't be. If you want to protect and to grow your wealth, you gotta do some work. If someone feels uncomfortable or just too goshdarn busy well that's too bad for them and I have no sympathy.

A lot of people don't have the time or inclination to spend 100s of hours learning about all the other investments and becoming informed enough to have a good chance playing wallstreets manipulated markets with the professionals. So for most people that leaves dollars/real estate/gold/professional money manager. If you don't trust a professional money manager and don't have the time or inclination to do it yourself then holding in gold or silver might be a reasonable way to hold on to the purchasing power of your savings that should avoid huge swings or losses and wont require much effort.

Thank god there is Vanguard.

i don't buy that. increasing your returns by 4% a year would make a massive difference in your net worth over long periods of time. if you invest 100k over 30 years and make 8% a year instead of 4% a year, your portfolio after 30 years with the 8% is worth more than 3x as much as the 4%. its definitely worth doing some research if you can bump up your returns by even 1% a year.

I recently read this IRS policy applies to ETF's like GLD and SLV as well as to bullion coins and bars. Thus, it may only make sense to actively trade mining company stocks (for those inclined to gamble). However, since coins/bars can be traded without a paper trail, I suspect some may choose not to reward the government for devaluing our currency by paying tax on gold bullion sales. I've never sold a coin or bar and have no plans to. When I expected gold to decline, I chose to short leveraged gold-related ETFs rather than sell bullion.

We must also realize that some numismatic coins have returns far greater than gold or the stock market... or vanguard (damn Brons loves spamming for vanguard).

I'm not talking about growing but just hold its value, some don't care much about having a lot of money and would rather enjoy life and just save a bit for a rainy day, to me its sad that they can't without getting robbed through a hidden tax

It can and should be very simple

WTF are you talking about? Your on a different page

come on man you know (or should know) economics is just not that simple.

and gold does not give you that anyways. brons is damn right that that's what vanguard is for. this was taken in february and we're up 33% or so since then, so put it at say 540% increase in purchasing power if you put your money away and left it alone for 35 years.



gold even at its all time high today, is up about 650% nominally in the last 35 years... $1 from 1974 though is worth about $4.40 today, so what is that a 40 or 50% increase in purchasing power and the thing is at its super all time high? while the s+p's been basically stagnant for 10 years?

yeah its downright tragic that they cant just put their money in an index fund full of companies that earn money, they should instead buy a metal that just stares at you and sits there. i'd argue that most people with a tiny bit of money anyways end up not investing much in stocks or commodities, instead they end up buying a house and hey thats way better inflation protection than buying a brick of gold

you had me going until the last underlined part, you have lost credibility by saying that...

Closed Vanguard funds? What are you talking about? Some funds are closed for new investors because they're getting too big, not because they failed.

honestly i dont ever want you to agree with me. so i'm happy.

Exactly Brons, the fund you recommended in a previous thread simply was not good value investing considering the timing, there are only so many good investments. Vanguard has a lot of funds now that should be closed... they are speculating on a false recovery. The opportunity to buy back into equities will most likely punch us in the face. I understand they have a great track record and I respect them for it.

Otis... your historical over generalizations will get you far, keep up with the nonsense
math is hard

Sigh, I don't think you know what Vanguard does and why you should invest with them. It doesn't really matter tho, just hold your gold.

Tip: www.bogleheads.org

By the way: the funds were closed because they got too big for the market. For example they are so big in TIPS that they can hardly buy more.

I know why funds close to the public Brons...
I know about Vanguard, and I don't just hold gold
You assume way too much