Gold naysayers habitually point to the relatively weak performance of gold compared to the broader market over the last five years. Given the market today, that argument is increasingly wrong, and the naysayers are soon to either admit their mistake, or pretend that they were never naysayers at all. That's because during the last three months, five major new forces have emerged to compound the previous strong drivers of the gold price up to now.
These new forces are as follows:
- China has stopped buying U.S. debt.
- Future discoveries of gold deposits will diminish dramatically.
- Existing by-product gold production will fall sharply
- Gold is becoming mainstream
- Gold is the best performing asset class of the decade
Now that the global financial meltdown has got up a head of steam, investors are hard pressed to find any investment that has performed well over the last ten years as consistently as gold.