Best of the Week
Most Popular
1. Market Decline Will Lead To Pension Collapse, USD Devaluation, And NWO - Raymond_Matison
2.Uber’s Nightmare Has Just Started - Stephen_McBride
3.Stock Market Crash Black Swan Event Set Up Sept 12th? - Brad_Gudgeon
4.GDow Stock Market Trend Forecast Update - Nadeem_Walayat
5.Gold Significant Correction Has Started - Clive_Maund
6.British Pound GBP vs Brexit Chaos Timeline - Nadeem_Walayat
7.Cameco Crash, Uranium Sector Won’t Catch a break - Richard_Mills
8.Recession 2020 Forecast : The New Risks & New Profits Of A Grand Experiment - Dan_Amerman
9.Gold When Global Insanity Prevails - Michael Ballanger
10.UK General Election Forecast 2019 - Betting Market Odds - Nadeem_Walayat
Last 7 days
Labour vs Tory Manifesto Voter Bribes Impact on UK General Election Forecast - 6th Dec 19
Gold Price Forecast – Has the Recovery Finished? - 6th Dec 19
Precious Metals Ratio Charts - 6th Dec 19
Climate Emergency vs Labour Tree Felling Councils Reality - Sheffield General Election 2019 - 6th Dec 19
What Fake UK Unemployment Statistics Predict for General Election Result 2019 - 6th Dec 19
What UK CPI, RPI and REAL INFLATION Predict for General Election Result 2019 - 5th Dec 19
Supply Crunch Coming as Silver Miners Scale Back - 5th Dec 19
Gold Will Not Surpass Its 1980 Peak - 5th Dec 19
UK House Prices Most Accurate Predictor of UK General Elections - 2019 - 5th Dec 19
7 Year Cycles Can Be Powerful And Gold Just Started One - 5th Dec 19
Lib Dems Winning Election Leaflets War Against Labour - Sheffield Hallam 2019 - 5th Dec 19
Do you like to venture out? Test yourself and see what we propose for you - 5th Dec 19
Great Ways To Make Money Over Time - 5th Dec 19
Calculating Your Personal Cost If Stock, Bond and House Prices Return To Average - 4th Dec 19
Will Labour Government Plant More Tree's than Council's Like Sheffield Fell? - 4th Dec 19
What the UK Economy GDP Growth Rate Predicts for General Election 2019 - 4th Dec 19
Gold, Silver and Stock Market Big Picture: Seat Belts Tightened - 4th Dec 19
Online Presence: What You Need to Know About What Others Know About You - 4th Dec 19
New Company Tip: How To Turn Prospects into Customers with CRM Tech - 4th Dec 19
About To Relive The 2007 US Housing Market Real Estate Crash Again? - 3rd Dec 19
How Far Will Gold Reach Before the Upcoming Reversal? - 3rd Dec 19
Is The Current Stock Market Rally A True Valuation Rally or Euphoria? - 3rd Dec 19
Why Shale Oil Not Viable at $45WTI Anymore, OPEC Can Dictate Price Again - 3rd Dec 19
Lib Dem Election Dodgy Leaflets - Sheffield Hallam Battle General Election 2019 - 3rd Dec 19
Land Rover Discovery Sport Brake Pads Uneven Wear Dash Warning Message at 2mm Mark - 3rd Dec 19
The Rise and Evolution of Bitcoin - 3rd Dec 19
Virtual games and sport, which has one related to the other - 3rd Dec 19
The Narrative About Gold is Changing Again - 2nd Dec 19
Stock Market Liquidity & Volume Diminish – What Next? - 2nd Dec 19
A Complete Guide To Finding The Best CFD Broker - 2nd Dec 19
See You On The Dark Side Of The Moon - 2nd Dec 19
Will Lib Dems Win Sheffield Hallam From Labour? General Election 2019 - 2nd Dec 19
Stock Market Where Are We?  - 1st Dec 19
Will Labour's Insane Manifesto Spending Plans Bankrupt Britain? - 1st Dec 19
Labour vs Tory Manifesto Debt Fuelled Voter Bribes Impact on UK General Election - 30th Nov 19
Growing Inequality Unrest Threatens Mining Industry - 30th Nov 19
Conspiracy Theories Are Killing This Nation - 30th Nov 19
How to Clip a Budgies / Parakeets Wings, Cut / Trim Bird's Flight Feathers - 30th Nov 19
Hidden Failure of SIFI Banks - 29th Nov 19
Use the “Ferrari Pattern” to Predictably Make 431% with IPOs - 29th Nov 19
Tax-Loss Selling Drives Down Gold and Silver Junior Stock Prices - 29th Nov 19
We Are on the Brink of the Second Great Depression - 29th Nov 19
How to Spot REAL Amazon Black Friday Bargains and Avoid FAKE Sales - 29th Nov 19
Central Banks’ Gold Buying and Repatriation Spree - 28th Nov 19
Another Precious Metals’ Reversal Coming Right Up! - 28th Nov 19
Stock Market 100% Measured Moves May Signal A Top - 28th Nov 19
Don’t Look for Investing Advice in the Media - 28th Nov 19
Why You Should Buy Trailer Park Stocks - 28th Nov 19
Will YouGov General Election Forecast 2019 be as Wrong as their REAL Forecast was for 2017? - 28th Nov 19

Market Oracle FREE Newsletter

UK House prices predicting general election result

Why $10,000 Gold Will Not Be What You Think

Commodities / Gold and Silver 2018 Jun 07, 2018 - 12:39 PM GMT

By: Avi_Gilburt

Commodities

For almost 7 years now, I have been actively engaged in the online community relating to investing opportunities. In fact, my first public article about a specific asset was when I called for a top in gold back in the summer of 2011, when most were certain we were about to easily eclipse the $2,000 mark. However, my expectation was that the $1,915 region would likely put a cap to this rally, despite the parabolic rally we were experiencing in gold at the time. And, as we now know, gold topped at $1,921 about a month after my top call.


Since that time, I have not only written hundreds of public articles, but I probably have read much more than 5 times that amount regarding various financial markets.

The one thing that has always stuck out in my mind is that the market rarely does what the majority expect. In fact, most still believe that gold is a safe haven from stock market volatility. While I have attempted to dispel that notion with actual facts from market history, many still hold fast to this fallacy.

During my time writing publicly over the last 7 years, one of the other fallacies that has been brought to my attention is that if gold really rallied to $5,000 or higher, then the world will likely be in terrible shape. In fact, many have gone so far as saying that one would not likely want to live in a world of $10,000 gold. And, I just saw this reiterated again in the comments section in an article recently written by Doug Eberhardt.

So, let’s explore this line of reasoning a bit more.

Back when gold was around $300 almost 20 years ago, many people were saying at that time that one would not want to live during a period of time when gold was at $1,000-2,000. In other words, they made an assumption that a significantly higher price for gold would suggest that the world was in disarray.

Well, for those of us that have been living for the last 10 years, we have seen gold rally from $300 and almost strike that $2,000 region. And, with gold now over 4 times the price it was 20 years ago, we can attest to the fact that the world has not come to an end. Moreover, for those who were truly paying attention, much of gold’s rally from 2002-2011 was accompanied by a rally in the stock market from 2002-2007.

As we now hover around the 1300 region, which is still more than 4 times the $300 level struck in 2002, I don’t hear anyone complaining about how we are now living in a devastating period of time.

At the end of the day, I think many investors have certain notions they have developed about gold and what it represents. In fact, many hold fast to these views almost religiously. Yet, since most of these views are based upon outright fallacy, one may want to simply look at gold as another asset class, rather than impute some over-inflated wrong notion relating to the times in which we live.

If you analyze what gold will do as an asset class well, then you will do well with your investment. If you view gold from an emotional perspective or a perspective not based in fact, then it will likely hurt your investment returns over the longer term. Just remember how most of the market viewed gold back in 2011, and were certain that gold would rally over $2,000. Remember how, at that time, most thought that revisiting the $1,000 region was simply ridiculous?

While I still maintain the expectation that we are on the cusp of a major multi-decade bull market in the metals market, I don’t necessarily expect the world to end. Nor do I buy into the common perspectives held by the overall market, as when most in the market believe something will happen, it rarely turns out that way. While I certainly see some very hard times setting up for our equity markets over the next 20 years, I don’t see the stock market revisiting the lows seen in 2009, whereas I do see the metals market significantly higher in the coming decades.

Just something to think about.

Avi Gilburt is a widely followed Elliott Wave technical analyst and author of ElliottWaveTrader.net (www.elliottwavetrader.net), a live Trading Room featuring his intraday market analysis (including emini S&P 500, metals, oil, USD & VXX), interactive member-analyst forum, and detailed library of Elliott Wave education.

© 2018 Copyright Avi Gilburt - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules