All good points, I was only harping on your criticism that the real price of gold dropped ten times since 1980. Yes, that is true, and that’s why it is at a good price now.

I am not forcing you to buy it, but consider your own math. 7-8% annual increase because of inflation, I agree perfectly, that’s a double every decade. Of course, you have to use long time frames and not just a decade. $50 fair value in 1970 before the boom would be 16x$50=$800 in 2010. $850 in 1980 after the boom would be 8x$850=$6800 in 2010. So a range of reasonable historical assumption would be $800-$6800 for 2010. Or $1600-$13600 for 2020. For me gold is still cheap right now. For you maybe not. Maybe for you, bonds, stocks, or real-estate might seem cheap.

$350-$400 cost is not a correct number to look at. That might be an average cash cost for some mining companies but not when you include general and administrative expenses. Most mining companies at the margin (what counts in economics) are struggling to break even. It is also a production issue. If there is more investment demand, it will take years to up production, and gold can trade five times above the cash cost. Kind of like oil at $70, even though some oil companies get it out of the ground for $10.