Gold Purchased At 1980 Peak Outperformed By Checking Accounts

bloomberg.com:

Dec. 7 (Bloomberg) -- Gold's best year in three decades has yet to match the returns of an interest-bearing checking account for anyone who bought the most malleable of metals coveted for at least 5,000 years during the last peak in January, 1980.

Read the whole story: bloomberg.com

Comments

[invest in jobs]

11:01 AM on 12/09/2009

it;s unfortunate Obama is taking advice from neoconservative, globalist economists like Bernanke, Geithner & Summers instead of being more receptive to Krugman & Volcker.

hat tip to: http://financeopinionss.blogspot.com

[nopilikia]

01:57 AM on 12/09/2009

Hold on to that confederate money boy's the south will rise again. Oh, my bad, hold on to that U.S. dollar boys --------------------.

[swift goat pet for truth]

10:02 PM on 12/08/2009

So, how much would I have made if I had bought Lehman Bros at its peak? AIG? CitiBank?

[drkazmd65]

03:59 PM on 12/08/2009

Sure - the stuff is pretty,.... but you can't eat it, sleep under it, and it doesn't have any day-to-day value other than in some electronics.

[LunaPark]

07:52 PM on 12/08/2009

"but you can't eat it, sleep under it..." You can't eat paper dollars or sleep under them, but it does'nt matter. The market determines what is and is not valuable. At one time, tulip bulbs were currency. Believe it or not, there was a Dutch tulip bubble replete with a panic and crash in the tulip bulb market .

[evil goat]

12:12 PM on 12/09/2009

Yes, but with paper money you can buy food and pay your rent.

[invest in jobs]

03:38 PM on 12/08/2009

This is further proof that the US government is ineffectual at everything except enabling the plundering of everything we, the American people, work for by the corporate robber barons
good articles; http://financeopinionss.blgospot.com

Government & multi-national corporations like peas in a pod

[RSKaz]

02:21 PM on 12/08/2009

Buying gold ranks up there with scams like the International Star Registry. The US economy is not based on the gold standard. Unlike the US dollar, you don't physically posses your gold; can't access its value through a bank or ATM; can't spend, trade or exchange it; buyback is usually 40%-60% of purchase value. To top it off, the gold sales pitch is targeted directly at the usual get-rich-quick saps, and paranoid anti-American teabaggers. Both of these groups readily swallow the premise that the US economy will collapse and gold will be the only means of barter. That is, if they can ever find the hidden vault to redeem their "certificates of authenticity."

[LunaPark]

07:41 PM on 12/08/2009

Actually, it's the US Dollar that ranks up there with the international star registry. When the Argentine peso collapsed in 2000, gold was used to barter with, particularly gold jewelry. Currently in Zimbabwe, after a debt fueled currency crisis, gold is used to buy everyday items. Locals pan the rivers in Zimbabwe for the gold. By the way, in January of 2009, Zimbabwe issued the $100 trillion dollar note. No one with intelegence would sell gold at a 60% discount on the spot price. Even if you sold your 2001 physical gold purchase at a %60 discount, you would still make money.

[RSKaz]

09:29 PM on 12/08/2009

Then you should feel right at home when you move.

[PocketWatch]

09:53 PM on 12/08/2009

O don't understand why you say that you don't physically possess gold or any other precious metal. Of course you can, and IMO, you should if you "invest" in it. I would never hold a piece of paper that said that I gad gold or silver in some bank's vault somewhere. What good is that?

[swift goat pet for truth]

02:06 PM on 12/08/2009

Hindsight, and all.

[platanoman]

01:45 PM on 12/08/2009

Gold is useless. Dont believe the hype

[swift goat pet for truth]

02:08 PM on 12/08/2009

Store of value for all Old World civilizations for 5000 years.

Meanwhile, we have had money by fiat for 40 years or so.
Money by fiat has NEVER worked. Not for the Romans. Not for the Chinese. Not for anyone. Ever.
Not for the Mexicans, Brazilians, SouthEast Asians, Russians in the last 20 years.

[platanoman]

07:11 PM on 12/08/2009

I dont care. That's what we are using

[TheMadHedgeFundTrader]

01:13 PM on 12/08/2009

With gold's whopping great $80, 6.6% pull back from Thursday's all time high, I have been deluged by readers asking if this was the peak, if this was the final blow off top, and if gold is finished as an asset class. My answers are no, never, and not on your life. I see the three day plunge as a gift. If you forgot to buy gold at $35, $300, or $800, another entry point is setting up for those who, so far, have missed the gravy train. Start scaling in around the Dubai low of $1,135, and add on further declines down to $1,040. That's where the Reserve Bank of India started the recent love fest for the barbaric relic with its 200 ton purchase in November. If the institutional world devotes just 5% of their asset to a weighting in the yellow metal, as many have recently promised, it has to fly to at least $2,300, or higher. By the way, you can pick up those gold pesos by visiting Millennium Metals by clicking here. ETF players can look at the 1X (GLD) or the 2X leveraged gold (DGP). If you don't believe a single word of this, or want to protect your existing holdings from a more prolonged move South, visit the Horizons BetaPro Comex Gold Bullion Bear ETF (HBD.TO), a 200% leveraged short position in the yellow metal. Madhedgefundtrader

[imipolex]

07:44 AM on 12/08/2009

Hmm, So let's pick the (very brief) blow-off top from 30 years ago, and compare it to today. Makes sense (not). How about gold since 2000?? Let's do the math:

Gold's high in 2000 was $275/oz. At the moment it is $1152. Let's see, that's, um, a 419 percent increase. If your checking account is earning that kind of interest, well, good on you.

There are times when gold is a lousy investment -- e.g. 1981-1999. But for the last decade, gold has been an excellent investment.

[PocketWatch]

07:14 AM on 12/08/2009

I read once that European families, having gone through wars and upheavals for centuries, have always stashed away a little silver and gold as a cushion against monetary collapse and/or governmental upheaval. Sounds like a plan to me. I can't afford gold, but silver looks like a pretty affordable thing to acquire and hold physically. No way would I just buy "certificates" that I couldn't cash in during a collapse. Gimme the real thing.

[goto1000]

06:36 AM on 12/08/2009

What would the stock market returns have looked like compared to a checking account, if purchased at the 1929 high and looking in 1959? Yes, thought so......

And, here's news. The current celebrations of 10000 on the DOW index of corrupt American corporate oligarchy are a bit ridiculous when viewed from an outside perspective. In terms of euros, the DOW is down 44% from the 2001 high (yes, that's right, the bubble before last even!!!) - in spite of the past few months near 60% 'recovery' !!! Your euro checking account would be blowing the DOW out of the water for the next 15 years as things stand. If you believe the dollar will recover and the DOW stay where it is or gain some more, then fine. It may even do, for a while. But the long term trend of an uncompetitive and bankrupt country, now being forced into desperate, and once only asset sales to fund itself one final shot of 'growth' (in debt funded consumption of foreign made goods) is pretty clear.

Bloomberg should know better, and it usually does to be fair. Daft article.

[UniverseMan]

04:31 AM on 12/08/2009

Peter Schiff responds to this article:
http://www.youtube.com/watch?v=epe5OF-oyr4&feature=sub

www.SchiffForSenate.com

[deepfreezevideo]

10:58 PM on 12/07/2009

Gold Purchased At 1980 Peak -
Yeah of course, it was purchased AT THE PEAK.
See why this is the most lame attempt to debunk gold ever?
Of course, if you bought gold AT THE PEAK you're not doing so well.
What if you bought gold at the LOW END and THEN SOLD it at the peak?
That's what you're supposed to do.

[David Howe]

10:57 PM on 12/07/2009

The ups and downs of gold are even more elusive than the stock market. At least stocks represent a tangible thing. Gold is tangible, of course, but it's not a very useful element. It's really only valuable for jewelry. And even then, the value of the jewelry is not in the metal but in the workmanship. There is no industrial use of any consequence.

It's interesting that the linked article shows what a lousy investment gold is (all investment professionals agree btw) and yet poster after poster insists that you should buy gold. Amazing.

[AZterritory]

11:00 PM on 12/07/2009

Gold is used extensively in industry, in computers, covering lunar/space capsules, in dentistry, the list goes on. You just don't see it like you notice jewelry. (Kind of like most diamonds are used for industrial purposes and not engagement rings :-)

[ErnestineBass]

12:33 AM on 12/08/2009

Thank you!

It's always refreshing to read the comments of an INFORMED poster. 8-]

[UniverseMan]

03:01 AM on 12/08/2009

I maintain that the article does NOT show any such thing. Poster after poster has pointed it out already, but the article says that gold has been a lousy investment in the time frame of its all-time inflation-adjusted high until right now. Isn't it true that the same can be argued about anything that is not at its all-time high RIGHT NOW? Hey look, I could stuff my money under my mattress and my returns would be greater than if I bought the Dow Jones at its peak in October 2007! Therefore the Dow is a bad investment! The absurdity of the argument is obvious to almost everyone here, which is why you are so, so busy trying to convince us all of your point of view.

www.bullionvault.com--buy as little as one gram of gold