buffet's bursting bubble, page-8

I find the whole gold argument fascinating.

I like listening to Schiff and some of the other bugs, but I am not convinced. I suspect if I was hearing the whole and complete truth, it would ring true with me, instead it is just making want to keep reading.

I am reading (audio book, eyes are knackered) books on economic history - can't suck it up fast enough, but still not finding the answer. (seams to lurk somewhere near the M1 money supply I suspect)

It is not difficult to get exposure to Gold through mining stocks, especially multi mineral plays if you are not convinced.

Bubble - I have never heard of a bubble that took 10 years to make. Other bubbles look obvious in retrospect. If Gold was full of hot money and empty heads, it would have fallen further and faster. So if it is a bubble - it is whole new kind of bubble, one that I can't be sure has even happened yet.

Gold is being pushed hard by many clever websites and some very smooth talking pseudo economists. They make a lot of sense, but like I said, something I am not smart enough to pin point does not add up. Never believe anyone with an angle. Actually belief is for lazy minds anyway.

Does gold have inherent value? - of course it does, it costs 800 bucks/oz to get it out of the ground. Iron Ore costs 40 and sells for 160 - thats 4x - gold is only 2x. So Buffet is right, in as much as gold is too expensive to be useful, but seams to me that is factored into the price.

Rare art is not particularly useful, (unless you are an art/history student), rare wine even less so. Both are stores of wealth relative to quality and rareness.
Plenty of both at Mr. Buffets estates I'm guessing. More importantly - people have a lot of emotional attachment to them. Haven't seen rare painting prices crashing recently.

Biggest markets for Gold are Central Banks and Asian Markets - what are they doing, why are they doing it and is that likely to change?

When you can get exposure to a play like ORS or CVR, UML MSR BDR BLK or many others, where a thousand bucks could provide multiple upside in the ST and you could still probably get out with half if things go wrong, (which is always highly likely also) - I don't see why you need to be a "believer" either way. For these plays to do well, they only need gold to stay above .....insert you own number, but it is well below current prices.

It is much more fun to be a part of history with skin in the game I reckon.
(Just make sure it is skin you can grow back)

Hope your enjoying the ride - next weeks conundrum - China Growth, how many % do we need to maintain new Base Metal project developments? Should we be buying in the dips or looking for Blue div plays?