Gold Prices
There is a basic principle seasoned investors use to check to see if any type of investment could be experiencing a bubble, and this is when the majority of the public understands it and claims to have a piece of the action. That's the same with gold, and while many people are talking like this has happened with the precious metal, it's highly doubtful that's the case.
What has really happened with gold to me is the financial press and news outlets have been covering it more, but that doesn't translate to the regular person on the street who really doesn't follow those programs. In other words, those that always follow business and investing news are aware of the reason gold is going up and why it will continue, but those that are average investors haven't picked up on it yet, so the upward price movement of gold isn't happening simply because of a hoard of investors joining in a gold feeding frenzy.
So when you hear that we are in a gold bubble, that isn't true at this time, and could even be part of a strategy of speculators who have shorted the yellow metal and could be getting clobbered as it keeps on moving up. Rumors like that are part of playing the speculation game, and very well could be the reason it's becoming part of the conversation.
The bottom line is everyday people haven't really understood or started to invest in gold yet, and until that happens, a bubble is still on the far horizon. This doesn't mean it won't happen, just that gold prices are being moved by market forces and economic circumstances, not by talk around the water cooler.
Gold Prices
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