Gold and a Credit Bubble

ibb and goldIBB in black is a biotech ETF, blue line is the S&P 500 Index, and gold color is the GDX senior gold miners.

Gold is a current asset, with no future cash flows–it is the financial opposite of biotech. This is why gold is the ULTIMATE LOSER during the growth of a credit bubble, but a SURE WINNER when it collapses. It is why gold mining companies will go from being worth next to nothing to something, a nearly infinite percentage increase. –Dan Oliver, Myrmikan Capital


In Gold we Trust 2015 – Extended Version (e)


3 responses to “Gold and a Credit Bubble

  1. What about “barbarous relic” and Buffet views it as not producing cash flow…

  2. Is gold an investment? How do you define an investment?

    WHAT is gold? Answer or try to answer those questions. You will learn more than just my opinion.

    If someone said to you that gold was more “money-like” (What is money?) what empirical proof would you need to know to determine whether true or false. What is the cash flow of a a Euro?

  3. John, I am heavily invested in gold so i guess i am on your side here 🙂
    Anyway gold is money because it is tangible, it is countable, it is valuable, it is recognized and it is scarce..and have been used as money much much longer than anything else…
    About the cash flow question – i do not agree…partialy…Buffet point is that even a depression arrives the stock can go down but if the business is sound then it still manages to work…
    That was my point and to add again i do think gold will go do $2500 but don`t know when 🙂

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