Seriously, gold is a great investment, at maybe $80/ounce. Me, I’d go as high as $150/ounce, maybe. Higher than that, no way. Even if I inherited a dozen pounds, I’d sell it off before the sun set.
I guess I know enough about the stuff to remember two things.
The first is that it is just a metal. No gods or demons within.
The second is that when people get gold fever, they’re as silly in the head as religious cultists or gamblers. And just as immune to common sense or persuasion.
I agree with you, however, I would buy gold at around $400, if it fell that low. That is the last price at which we bought and we did so as jewelers, buying casting grain and wire/sheet. I did purchase some 1/10 oz US coins from a friend at $560/oz spot, several years ago. I felt then that the price was a tad high, but she was in a situation where she needed her cash immediately and I had the cash and so, it worked out for us both.
In the long run, gold just makes me nervous. If it all falls apart, I doubt that gold will be usable for day-to-day transactions without some government middleman adding a tax or otherwise dictating how much can be exchanged or under what circumstances.
Notice that silver is being bid higher lately. I think sterling was about $8/troy oz (+ premium) when we last purchased it and we have a good amount. Still, I think this PM market is a lot of group think and herd behavior. Having the ability to work the metals and turn them into useful objects is the main reason we still own it.
I also remember that in the 80s, with $800 gold and $20 silver, our phone rang off the hook with people looking to sell anything they owned. All we could offer them was melt price and that is all they could get from the major buyers, as well. Even at those prices, items like Paul Revere tea sets and other objets d’art were being sold for melt. It was a tragedy, IMO.
Let me finish that for you."Prices go up."
Timing is everything!