Fools Gold?

One of the biggest asset classes in the news lately has got to be gold. As the Euro continues to weaken, gold has surged in price over the last several weeks to all time highs in price. Last Friday's close had gold priced at a never before seen value of $1258/oz. Year to date, gold is up over 13% and has gained over 87% in value in the past 3 years. So is it too late to buy gold? Some pundits expect gold to continue to climb to $1500, and some even predict $2000 in the not to distant future. Of course, like anything else, it all depends on your goals and objectives. Are you in it for the long haul or just for a short term play? If the US Dollar strengthens from actions from the Fed or Treasury Dept. moves, then the price of gold may come down a bit. But as long as interest rates stay low and the stock market continues to be extremely volatile, these predictions could play out. Just remember, had you bought gold in the early 80's at the going price of $800 per oz., you would have watched it go down below $300 before it came back up to today's values. Also, adjusted for inflation, the price of gold would have to hit $2400/oz. to really be at an all time high in terms of purchasing power. If you still want to get in on a piece of the action, the easiest way to play is by buying the Gold Trust ETF, "GLD" or the Market Vectors Gold Miners ETF, "GDX". You can hold it in your brokerage account and not worry about the cost of storage fees and safety issues that gold bars and coins entail. Think gold is too expensive? Try silver. It usually follows the path of gold, and is a fraction of the cost. The Silver Trust ETF, "SLV" can be had for $18.42/share at yesterday's close, and silver has actually outperformed gold the past 12 months. It's up over 35%! Happy mining!