The ultimate answer to whether gold is in a bubble
There seems to be a lot of debate as to whether gold is in a bubble, and I'm here to put this question to rest.
First, one assumption. I am assuming you are coming to TMF because you are hoping to make a profit. You're hoping to grow your wealth in the financial markets. If that's not your objective, if you're just here for the "amuse" part of "to educate, enrich, and amuse," then please feel free to skip the rest of this discussion.
"Is Gold In A Bubble?" is not the right question. The right question is "why are we talking about this?" There are many people who think that gold is in a bubble, and they support their case with facts, reason, and good thinking. There are many people who think that gold is not in a bubble, and they support their case with facts, reason, and good thinking. What's an intelligent investor to do?
Let's look at one more fact. The price-to-book ratio of Berkshire Hathaway sits at 1.07 right now as I type this before the market open.
If you are an intelligent investor, and you treat investing in a very businesslike way, and your objective is safe, strong returns, then the discussion ends there. Figuring out if gold is in a bubble is a hard question. Figuring out whether you're likely to make good money buying Berkshire near book value is not.
Everyone on both sides discussing whether gold is in a bubble, the value of gold, or whether gold is money is wasting your time. Some of the best businesses in the world are on sale right now.
Disclosure: I own shares of Berkshire, and I own gold