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Originally posted by kozmo
To those who don't believe in a gold bubble... good luck to you!!!
COMEX (GETF or Gold Exchange Traded Fund) gold is NOT real gold. It is a stock, a "share" of gold. Right now it is estimated that there are 80 to 100 times MORE shares of gold than there is actual gold. If those holding GETF gold executed a call on their holdings, The GETF representing the trade would not be able to fulfill its obligation to deliver simply because the gold only exists in theory, not reality.
The important thing to keep in mind here is that there is no real currency peg to gold, other than what the market says it is. We abandonded the gold standard under Nixon which effectively put the value of gold out in space subject to the whims of the traders, not the GDP of the nation holding it.
The bottom line is that gold is only valuable in its physical essence and its value is only what someone is willing to trade in exchange for it. Since there is no currency peg to gold, the whole notion of "value" is speculative and subjective. This bubble will most certainly burst as all other bubbles have. If you are looking to own gold, you had better make sure that you are buying physical gold - and only buy it as hedge against currency, not as a money making investment.
Originally posted by badgerprints
There is no gold bubble.
It's a dollar bubble.
Gold is an inert commodity with intrinsic physical value. It won't ever lose or gain value. It will simply have a price tag that varies. That price tag in dollars is going up because the dollar is dropping.
The dollar is a piece of paper that is approaching worthlessness because our politicians and the fed have made it that way.
[edit on 2-12-2009 by badgerprints]
Originally posted by brocket99
Heres what's really happening.
Everyone who owns gold is saying to buy gold. Just like everyone who was making tons of money in the stock market or real estate wants you to buy their product.
Golds bubble will burst, and the common man who is holding the bag and bought at the highs will lose their shirt. Just like every other manipulation in our history. Is that now? $2k an ouch? $3k? $1500?
Now is the time to sell and buy other things on the cheap. Including US dollars.