The Sane Investor

Is Gold As a Safe Haven Just a Myth?

Babak, great article man. I will say that I don't really want to own any sort of gold miners, since many of them are very highly leveraged. Although if gold goes on a rout they'll likely do the same, we're in a weird in-between time where gold really hasn't been reacting the way I, or anyone else frankly, thought it would.

I think we're going to have to see some serious threats to the dollar before gold prices go in to any sort of bull market. Right now, from everything I've been reading in major investment news sources, people aren't really concerned about the strength of the dollar, and for quite some time now if you've been holding on to dollars you've seen some pretty good returns comparable to other currencies. Because of this, I don't think anyone sees a short term benefit to holding gold vs. dollars, especially when you take in to account that dollars are far more liquid.

I think that as soon as we see a sustained drop in the dollar (i.e. week plus) and serious questions about its weakness, gold will go on a tear.