This is classic equity bug stuff. They are so steadfastly stuck in normality bias despite all of their marketing proclaiming the pas is no guide to future performance. "look at average returns of >6% pa since eighteen canteen" (Prof Siegel). Fabulous analysis. How many of us can benefit from 100+ years of average returns? (I'd be interested to know how much of that was achieved in the last 40 years since credit was allowed to grow unfettered. A lot I suspect). They make it sound like gold is an equity replacement when most rational gold "bugs" do not see it that way. They are fighting the wrong battle. Why? I wonder! They need to sell equity funds. Gold is a store of value undoubtedly. Just look at the bond market these days to see how important that is to people right now. The new mantra is return of capital not return in capital. Gold is a chaos hedge, the probability of which has grown considerably in recent years, so the chaos option value has risen thus taking with it the gold price. To glibly assert the crisis will resolve itself is further confirmation of the normality bias. Incredible blind faith when you think about how the world has been grappling with this for five years now and is no further forward. Debt continues to grow, the wests creditors are diversifying into hard assets through fear of default (which is what QE is effectively) which will force up bond yields and kill equities. It took something like 15 years for equities to return to previous highs after the 1930s depression (a similar credit fuelled bust). Good luck with that. Buffet is the prime example of the normality bias. I lost a lot of respect for him when he became a mouthpiece for the US govt.

Everyone here seems unconvinced by Rob Gleeson’s argument, but Warren Buffett has exactly the same view:

http://www.trustnet.com/News/Research.aspx?id=321939

Question...which would you rather have when the balloon goes up...a handful of share certificates or some gold / silver bullion?

Yes.I bought into gold in '06 when the SIPP rules changed....have made around 236% in 6 yrs..and I'm not selling an ounce...all the world's central banks magicking mountains of money out of thin air...not good!

Of course the "fear and greed" people are constantly trading gold, driving the price up and down. But if you need cash when they have driven shares down, it is useful to have some gold which they have probably driven up.

10 out of 10 Gold can only be a buy when it's cheap, such as the dip to $270 which Chancellor Brown thought was a 'sell' opportunity

I think everything Gleeson has said has some grain of truth, but he has exaggerated everything.

In particular, gold has not held a steady value throughout history at all. In 1970 it was about $30/oz, in 1980 it jumped to $500 which it held until 2005, by 2010 it had shot up to $1200 and $1650 in 2012. It is certain to go much higher if the Western economies collapse, but will surely collapse when our problems are overcome. Those who are good at timing the market, will do well.

As I have no illusions about my ability to time the market and as gold has no earning power of its own, it is a pure gamble and this is why I would not invest in it. Investing is about small steady progress and has nothing to do with gambling. Naive people should take note of the fact that the big gamblers, hedge fund managers, Soros etc., are careful enough to do it with other people's money. Only suicidal fools do it on their own.

Gold is a good store of wealth over very long periods of time. Unfortunately it provides no growth nor income and in the words of J M Keynes "in the long run we're all dead".

Gold has traditionally been a safe have and has been a stellar investment over the last five years with a return of crica 213%. However, a word of caution, the emergence of ETFs and other securities enabling investors to more readily trade gold appears to have increased price volaility and gold is becoming more correlated with equities.

I suspect that if everyone started pouring into solid Gold then there would be less demand for ceratin financial intermediaries fund/houses commentators, banks and so forth.

Solid Gold has and will most likely be the true measure of the stability of the financial systems and nations.

So is this article written with a hint of self preservation.

Poppycock. The amount of gold bought by individuals is tiny. We are talking sovereign states buying gold to protect future wealth (Russia, India, China etc.) Look at the value of gold compared to the purchasing power of the $. Currencies will continue to devalue as more cash printed. Countries are already showing signs of wanting payment in gold not $ (Iran for oil etc.) Anyway you look at, gold and silver are the best ways to protect long term wealth

If you'd sold everything 10 years ago & bought gold, you'd have done rather well, though you'd have hacked off a lot of financial intermediaries, deprived of initial and trail commission.

What is more, if your grandfather had taken everything out of the bank, as gold sovereigns, in 1914 and kept them in a sock they'd have kept their purchasing power---- a sov was £1 then, £250 nowadays.

"The financial crisis will probably be resolved eventually " says Mr Gleeson. Probably and eventually indicate uncertainty and whilst there is uncertainty, gold is a safe haven.

I also understood national governments to have stopped selling their gold reserves, and now buying it. This gold bull market began well before anyone had heard of the financial crisis, and with burgeoning middle classes in China and India, may well go on long after it is resolved.

One has to look at the history world had many crisis including wars but price of gold is always on the up there is no worry for gold going bust like companies and banks and now the governments.

So gold is good investment for the money you do not want for tleast 10 yrs.I have not invested but I am looking at it now

Mr Glezson has missed out on outstanding returns from the precious metal and comes across as a bit naive.