Is gold a good investment?The price of gold , just like any other commodity, base metals, will first appreciate and depreciate with offer and demand. For the last few years, the price of yellow metal has increased quite a bit and is now at a 25 year high. Has demand out paced offer? Is the metal so rare to justify that increase in price? It is true that there was not much exploration done in the last few years and that not many new mines went into production and maybe the metal is getting scarce. Is the price in relation with all the turmoil going on in the world these days? Has the Iraq war pushed the price of the metal up? Does the incertitude about the possible Iran nuclear intent done something to the higher price. There are many possibilities and there are as many theories as there are analysts of the metal as an investment. Should you buy it?At the price it is to day, we think that buying it is speculation. Sure the price can still go up but by how much?No body knows and since it is at a 25 year high, we think that the price has more chances of going down than going up.
If you are to invest, it maybe wiser to do it in non-cyclic growth stocks instead of gold . Do not get caught by the gold fever, just like you should not get caught by casino or lotto fever.
Be very pragmatic with your investments.
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