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Relax, its still contrarian.

Times have changed. There was no interest in gold sometime back and all of a sudden its all rage. The interest showed by general populace is amazing.

There are tons and tons of articles explaining the value of gold as a hedge against inflation. I feel like squeezing their neck and scream why are you giving the greatest investment tip of the century free and that to bozos who does not understand it at all nor make even a feeble attempt to understand. I ell them patiently these are the very people who will stone your house and break your leg, the day gold prices hit a correction phase. They just dont have the discipline or the conviction (convictions comes from knowing the underlying wisdom) to appreciate what you say. Anyway, I appreciate their concern for welfare of others. And I admire them for that.

And at the same time there are many articles, which are predicting the downfall in the commodity markets as the interest rates rise. This is, as of now, unfortunately not sufficient in number. I would like to propose the government give subsidy, tax exemptions and civilian welfare award to these writers. After all they are bringing all their gold out of their closet and selling. The brave people who think they can weather the financial storm without the gold cover.

The honest part is more they sell more the gold is cheaper haha

The gold is gaining currency and is not contrarian any more. Or is it?

Many people are rushing into gold for one of these reasons

1. They want to buy it before it goes up [or they have to buy it for their wife at higher rates]

2. They have heard analysts say it will go. Why? Why why?

3. They want to use the present momentum to make some money

4. The gold future are new instrument, and they want to roll and shine in front of their friends, in how they can handle complex financial instruments

5. (And very plausible reason, especially in growth economies like India and China) They just have too much money floating and incidentally are buying jewellery.

6. Just getting lucky

7. And yes some do understand. But I am willing to bet, this group is still very small

The fact of the matter remains, that not many people are buying gold understanding the real value of gold and why the investment makes sense. The contrarians still are very much alone in the love of gold. For sometime they have to endure the chase-the-fad freaks.

It makes eminent sense to invest in gold, even at this level. It is still contrarian.

:) Falkor

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