[quote=Eugene]FYI, 100% metals is a 100% losing bet. Precious metals are in a bubble that has yet to deflate. I expect a 50% decline in the value of gold and a 30% decline in the value of silver by the end of 2010.
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Eugene:

I’m not sure we have the same definition of bubbles.

This, for example, is a bubble:

http://www.lesjones.com/2008/11/25/inflation-adjusted-us-house-prices-1975-2008/

And then we have this:

http://www.kitco.com/scripts/hist_charts/yearly_graphs.plx

Does this really look like a bubble to you? Looks more like a slow but inexorable creep upwards to me.

Also, can you please tell me what factors would lead to a decline in the price of precious metals? Since they are dollar-denominated, it would seem to me that a fall in the price of metals would require a corresponding rise in the dollar’s value. Do you really see that happening?

I just get the sense that you keep saying that metals are in a bubble because you believe that, not because you are relying on any facts or fundamentals. And if that’s what you believe, that’s fine. But we need to be clear about what is fact and what is belief.