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Phew! That was a close call from our tenured
contrarian indicator...
YIKES! FOR ONE awful moment just then, I thought maybe the top was in.
"Gold has become the favored hedge
against financial and monetary uncertainty," said Niall
Ferguson, Harvard's financial history professor, on Monday.
"It's certainly a time-tested way of coping with really turbulent
markets."
Oh cripes! Niall Ferguson – our tenured contrarian indicator
– now says gold is a proven defense against
investment stress. It's taken 11 years and 356% gains in gold, but he's
finally got it.
That's the top. Sell!
Oh, hold on – "A lot of the upside is already there," Ferguson
went on, live by video-link
to the Wall Street Journal.
"The time to buy was in 1999, not 2010..."
Phew! As you were, then, bloody-minded gold buyers. And as you relax,
safe in the knowledge that Professor Wrong still says you shouldn't buy,
let's remind ourselves just what it was he advised 11 years ago – back
in 1999 – the "time to buy gold" as he now
puts it...
"The twilight of gold appear[s] to have arrived.
True, total blackout is still some way off...Gold has a future, of course.
"But mainly as jewelry."
Fast forward to late 2008 – some $445 higher per ounce for gold,
slap-bang amid the post-Lehmans Crash crisis
– and Professor Ferguson was at it again.
"I have been debating today whether gold bars really are the answer," Ferguson confessed to
the New York Magazine when quizzed about his portfolio for a puff piece that
November.
But "they probably aren't," he decided...thereby leaving another
$470 per ounce on the table over the last 18 months.
Now he says 2010 is not the time to buy gold either. So, given what happened when he rejected the
idea in mid-1999 and then in late 2008, expect another $400-or-so on the
price before the Laurence A.Tisch Professor of
History next weighs in with his forecast.
The man whose last TV-and-book blockbuster, The Ascent of Money, concluded that "the state-owned bank
[was] now close to extinction"...just as the UK
nationalized one-third of its finance sector, and the US Fed bought $2
trillion of failing bank assets...now advises that "There are other ways to protect yourself, and maybe somewhat
smarter ways."
Missing the point entirely once more, Ferguson recommends –
instead of gold – buying Norwegian and Swiss government debt for protection
from the sovereign debt crisis.
Clang! Clang! Everybody out!
Adrian Ash
Head of
Research
Bullionvault.com
You can also Receive your first gram of Gold free by opening an
account with Bullion Vault : Click here.
City correspondent for The Daily Reckoning in London, Adrian Ash is
head of research at BullionVault.com – giving you direct access to investment
gold, vaulted in Zurich, on $3 spreads and 0.8% dealing fees.
Please Note: This article is
to inform your thinking, not lead it. Only you can decide the best place for
your money, and any decision you make will put your money at risk.
Information or data included here may have already been overtaken by events
– and must be verified elsewhere – should you choose to act on
it.
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