Colin, why would you think GFC was a one off? IMO the worldis in a much bigger mess than before.
It looks to me like there are so many bubbles around the world waiting toburst.
GFC was caused by low interest rates that created irresponsible moneylending to home buyers in the USA and when the interest rates finally went up the party wasover. A lot of smart people saw the problem developing.
Some very wealthy people got wiped out entirely and some even committedsuicide.
Australia was in budget surplus yet our currency got smashed initially when everyoneran to USD.
We had much higher interest rates around the world and we were able torespond with massive rate cuts, stimulus and offer bank guarantees fordepositors.
Our government bonds were AAA (not that I trust these rating agencies, look atUSA not paying 800,000 employees and many thousands of contractors but stillrated AAA) but we were truly in a good fiscal position.
China reacted with a massive stimulus and so did USA and Europe and we avoideda total melt down as the financial system started to cease and we were not sofar from a run on the banks and a total financial Armageddon.
Fast forward to today and we've had even lower interest rates for much longer.What kind of bubbles has this caused around the world? Governments are in aworse fiscal shape with massive debts on federal, state and even city levels. Individual and corporations borrowed up again.
They don't have the gun powder that was available to them in 2008/2009 whichwas ability to quickly smash down the interest rates and flood the market with cheap money.
The money that will move gold price initially is the big smart money. Imagineif you are a high net worth individual and you go from a mode of trying to makemore money to just preserving your wealth. You are worried about your bankcollapsing, your stock market portfolio collapsing, your real estate assets droppingin value and even government defaulting or trimming your bond value. Where do you park some of that money for safety to weather down thestorm?
A lot of people say that when that comes gold will get smashed along with goldstocks as people will have to liquidate everything to cover margin calls etc...
This is what happened last time but remember prior to 2008 gold was alreadyin a serious bull run, people were sitting on significant gains in gold price and when GFC happened people ran to USD as a safe heaven and to governmentbonds.
Then, after the initial drop gold rocketed up with additional fuel of ongoingissues in the world until things settled and everyone got on stock market sugarhigh again.
Also I think we are so much wealthier today than we were in 2008/2009. So manymore millionaires and billionaires. The money pool is much bigger.
We don't know how this will play out this time. It is possible that we willhave a repeat of the same but remember we still haven't had the gold run uplike we had before 2008/2009 so my thinking is that perhaps people are not asinvested in gold as they were then.
I don't have a crystal ball and I don't know how history will be written butwe will know we are in a gold bubble when you hear about it in the main streammedia, when your Uber and TAXI driver tells you they invested gold. This is nothappening as yet.
I remember when Silver hit almost $50, my mother, bless her soul who hasno interest in investments, told me to invest in silver because of all the newsaround how silver was going to the moon. It was definitely a good signal tosell silver.
So lets wait and see, you might be right but I don't think we can rule out gold bubble in the future nor can we say gold won't take a hit like it did initially during GFC. To many moving parts. I am hoping that some of the world billions will start flowing into gold if things get nasty again.
This is only in my opinion, not offered or to be taken as financialadvice, DYOR
RSG Price at posting:
$1.14 Sentiment: None Disclosure: Held
(20min delay)
