Aug. 23, 2011, 12:00 a.m. EDT
Gold $3,000?
Commentary: If gold is like the Nasdaq, it could go up 60% from here
By Brett Arends, MarketWatch
BOSTON (MarketWatch) — I’m an idiot.
I’ve just spent the last six weeks on book leave, and I’ve realized I’ve been writing about the wrong topic.
My new book is about money and the Bible. Instead I should have saved myself the effort and just banged out a cheap, superficial pamphlet with a title that would have sold a million copies: “Gold $36,000.”
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While I’ve been on leave, gold has surged from around $1,500 an ounce to nearly $1,900. And the investing world has finally started to wake up to the inconvenient facts that (a) the U.S. government is broke, (b) the U.S. political system is broken, (c) Greece is bust, (d) Portugal and Ireland may well be bust, (e) Ditto Spain, (f) Maybe ditto Italy, and (g) the European political system is broken as well.
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Hardly anybody owns gold. The assets of the Gold Trust ETF are still trivial compared to the trillions held in equities and bonds. Four times as much money is held in Apple /quotes/zigman/68270/quotes/nls/aapl AAPL +1.31% stock alone as in the entire GLD.
At a recent conference of about 40 investment commentators and gurus, I asked how many people in the room actually owned any gold in their portfolios. Just two of us raised their hands.
Very few mutual funds own gold. Even most “precious metals” funds only touch mining stocks, not the metal. Your typical “balanced fund” or “asset allocation” fund has no gold. If you want to have, say, 5% of your portfolio in precious metals you need to add it yourself.
The world’s big money managers don’t own it either. Merrill Lynch (Bank of America Securities) surveys them every month. And every month they blow it a big fat raspberry. This month a record number — a net balance of 43% — told Merrill that gold was “overvalued.”
The only problem: Those money managers have been saying this almost every month for years.
Full story: http://www.marketwatch.com/story/gold-3000-2011-08-23
Gold is $1,581/oz today. When it hits $2,000, it will be up 26.5%. Let's see how long that takes. - De 3/11/2013 - ANSWER: 7 Years, 5 Months
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