Tuesday, 19 October 2010

The majority is almost always wrong..........from Rico

The majority, the crowd, conventional wisdom...the herd is almost always wrong.

So far in 2010, gold has only attracted $5.4 billion worth of US private investment...while $155 billion has flowed into bonds.

The talking heads-teleprompter readers are calling gold a 'bubble' while these numbers show just the opposite. But the 'herd' still sees CD's, bonds, and managed investments as 'safe' (chortle-guffaw-gasp). These same folks probably completely trust their banks and the good intentions of their government, too. Hell, some of them probably believe that Socialism would 'work' if only the right people were in charge.
- These paper assets are loaded with counterparty risk...with the RISK writ large. Banks fail, and governments default (after raiding the savings of its subjects either overtly by seizing their money - think Argentina, or covertly by inflating away the purchasing power of its currency).

This never ends well, and it'll be NO different this time.

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