Dan Perkins

Gold's Fundamentals: 'Extremely Appealing'

Clue 1: "In a crisis like this, you would expect gold would perform well. It hasn't done that. It's dropped lower than I ever thought was possible at this stage of the cycle." IE: Joe got burned!

If Clue 1, where Joe Foster admits that he doesnt' get it isn't enough, see Clue 2:

Clue 2: "First we'll go through a weak economy and deflationary scare, which will be favorable for gold." Then he say's we get inflation which will be good for gold. IE: Joe got burned because he does not get it!

This comment completely discounts the authors credibility and/or honesty. Joe Foster is either clueless, lying or both. You cannot have it both ways. Yea, right Joe, inflation and deflation are good for gold!

Gold is almost purely a luxury item. It looks nice so people want to wear it. But they need money to throw around, Joe and right now, that is a problem!

Buying gold right now is like investing in mink in 1929. When everyone is broke, luxury items go down in price not up! There is no magic, no secret formula, nothing to figure out!

Gold hit $850 an ounce in the mid 80's and $200 an ounce in the early 2000. There is no correlation between gold and inflation. When things get scary, the snake oil salesman start peddling gold and then sell theirs at the top while sucker are buying. The dealers got had this time expecting a $3000 top and bought high. The only way for one fool to get out is for another fool to get in.

Even if there were a correlation, it would not matter. We are in deflationary spiral, which will continue for years to come!