Occasionally the world delivers to me a real gem of a story. This is just such an item. I don't personally know the gentleman who wrote these jewels of wisdom and I've never been to his domain before today, but quite simply put this is the funniest and absolute worst investment advice I've ever seen in my lifetime. His professional advice is so darn funny and I thought it was a satire or a spoof about buying gold. I thoughtâ€¦ this could be a reprint of something found on the Onion.
Anyway, let me introduce Jamie Dlugosch who is a contributor to something called InvestorPlace.com. Try to follow his reasoning, you'll get a good laugh just like me. How anyone could perceive this logic as accurate is beyond my comprehension. It should be noted that if you follow these links and read each short article, at the end of each piece are links to his professional low priced stock picks.
(these are his articles NOT mine, these were written by Jamie Dlugosch)
Five reasons why gold is a BAD idea. I will be very blunt: I despise gold and everything it stands for. It's an abhorrent example of materialism and serves no real purpose. Lust for gold is over the top excess, and despite the protestations of the goldbugs, there is no real basis for the metal serving the currency needs of the world.
- Reason No. 1 to avoid gold: There is no inflation â€¦.Today, the numbers do not support an inflationary environment and fear over current spending and stimulus of the government creating inflation is misplaced.
- Reason No. 2 to avoid gold: Gold prices are easily manipulated â€¦One thing I am very afraid of with gold is manipulation. Unlike paper currency that is impossible to manipulate in any way, gold can be accumulated by a group of connected buyers for the sole purpose of eliminating supply from the market.
- Reason No. 3 to avoid gold: Gold is in limited supply â€¦Related to manipulation, the simple fact is that there is a limited supply of gold. In addition to fighting inflation, the Federal Reserve is also charged with promoting a stable currency. With gold, prices can be far from stable.
- Reason No. 4 to avoid gold: Gold was dead for 20 years â€¦The trouble is that the gold rush is not likely to last. In fact, there has been tremendous resistance for gold at $1,000 per ounce. Do you really want to buy at the top? I don't think so. Once the economy stabilizes and we get a return to normalcy with respect to the business cycle (in other words an ending of the boom/bust period), gold will go back into hibernation. Demand for jewelry cannot absorb the current supply. As such, a strong dollar is likely to absolutely destroy the price of gold.
- Reason No. 5 to avoid gold: The dollar is the global currency â€¦Recently, Treasury Secretary Timothy Geithner emphatically declared his belief in a strong dollar policy. Buying gold is like spitting into the wind then. If you can remove the clouds of crisis, the clear skies ahead provide comfort to me that gold has seen its best days. Those worried about massive deficits need to recall that our country was founded with debt, debt that was ultimately paid back.
Comments are invited and welcome. I encourage you to visit the links above and read each of these jewels of wisdom.