Gold: The Most Glamorous Commodity

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Jim Rogers has made a historical study of commodities and found that the typical cycle lasts 15-20 years. That means we could be in for another decade of higher commodity and gold prices.

Finally, after 28 years, gold hit a record of $858 an ounce, besting its previous high of $850 way back in January 1980.

I well remember those days of heady double-digit inflation when the dollar was crashing, silver was at $50 an ounce, and gold was hitting new highs every day. Howard Ruff's book, "How to Prosper During the Coming Bad Years" and Doug Casey's "Crisis Investing" were bestsellers, and people at church were coming up to me and asking how much "junk" silver they should buy.

But $850 gold and $50 silver turned out to be the top � a good time to sell, not buy. The year 1980 was a "tipping point," when Ronald Reagan was elected president and Paul Volcker, his Fed chief, imposed tight money and high interest rates to kill the inflationary psychology. It worked, and commodities fell sharply, even as traditional stock and bond markets came back to life.

Is 2008 another tipping point in financial history? The Midas Metal has been on a tear since the war on terror erupted in 2001. Above all, remember that war is inflationary, and the central banks have been busy printing a lot of new dollars, euros and yen since 2001 -- and since 1980...

Jim Rogers has made a historical study of commodities and found that the typical cycle lasts 15-20 years. That means we could be in for another decade of higher commodity and gold prices.

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