[quote=scaredycat]I tend to look at performance over the long haul, like from say, 1500 B.C. up to today. gold has done well for something with “no intrinsic value”.
you can’t run your car on cash. [/quote]
Over the long haul, gold will keep up with inflation while cash (obviously) will not. But investment in “industry,” generically, will outperform gold because it will provide a real return above inflation, which gold will not. Yes, sometimes gold will command some premium when inflation expectations or risk premia are unusually high, but over the long haul gold is just an inflation hedge.
Personally, I’d rather own businesses, generically, than gold. Even if the cash they throw off depreciates if not reinvested over a period of time. And even if the valuation placed on them declines in times of high inflation and perceived risk. Over the long term, “industry” is a far better inflation hedge than gold.
