OK, so I was wrong about gold.
In my first column of the year, I boldly predicted gold would top $1,700 an ounce in 2011. Now it's passed $1,800.
"A rising gold price is God's little messenger, reminding us the money we save for the future is just paper," I wrote.
Geez, I sounded like one of those crackpot spokesmen from the A.M. radio commercials: "Gold has never been worth zero!" And nobody seemed to take me seriously since I admitted that my forecast was based on questions posed to my Magic 8-Ball, rather than insights from a real market analyst or economist.
I've written columns bullish on gold since 2003, after gold hit an astonishing, nose-bleeding, long-time high of $385 an ounce.
Those were the good ol' days when, if you said something nice about gold, readers would email to call you a "gold bug" or some kind of conspiracy theorist planning for the end of the United States of America, or something.
When gold rallied well over $500 an ounce in 2005, I interviewed some very smart people who were pretty sure gold was just another bubble.
"It's had a nice run over the last 24 months," Jeff Thredgold, an economist with Vectra Bank Colorado, told me in 2005. "But gold is easily the single-worst investment of the last 25 years."
Economic outlooks were markedly different in 2005. Back then, we were looking for another record quarter for stocks and more sizzling new highs for home sales. Today, we're happy to hear our government isn't going to default on its trillions of dollars in debts.
Since the 2008 crash, and our ongoing failure to pull out of it, most people should have a pretty clear idea about where gold is headed and why. I don't have to tell you it's going to be worth $2,000, $3,000, $5,000 or ultimately, two giant truck loads of canned food and ammunition, at the rate we're going. But perhaps you've been distracted by naysayers along the way.
In a week heralding new records for gold, and a frightening dive for stocks, I thought it would be fun to look at some old news stories and examine examples of the gold bashing we've done over the past couple of years, much of it stemming from those moments when gold takes its inevitable, but temporary, pullbacks:
* "We had a bubble in gold fueled by exasperation and the inability to make money in stocks. Investors were hit by all the bubble sales pitches that suggested gold was a "can't-lose proposition.'" -- Brian Dolan, chief currency strategist for Gain Capital in a March 1, 2009, Chicago Tribune article that was unfortunately headlined, "Gold gains unlikely to pan out for long."
Don't you just hate it when gold goes over $1,000, falls to nearly $700, and then soars past $1,800? Clearly, this gold bubble will pop once the Federal Reserve announces that the economic recovery has been a grand success and it can now raise interest rates. But when's that going to happen?
* "Gold is worth what you think it's worth. It's very difficult to value. There are no cash flows, so it has no intrinsic value. There is very little commercial use for it. It's more of a trading vehicle." -- Bill Stone, chief investment strategist, PNC Wealth Management, in an Oct.9, 2010, New York Times article.
Yes, that's why they say gold is morphing into a currency while other currencies are morphing into stuff you haul around in wheel barrows.
* "Attempting to project or capitalize on price movements in gold is speculation, not investing." -- Steve Condon, director of investor advisory services for Truepoint Capital in Cincinnati, in an Oct. 12, 2009, Associated Press article.
Got that? Buying gold is speculation. Buying paper, now that's investing.
* "Too many naive investors got involved in gold. They must be taken out and given a right good caning." -- Dennis Gartman, a trader and publisher of the Gartman Letter investment newsletter, in a Dec. 8, 2009, Chicago Tribune article about "Newbie gold investors."
I would like to see them canned as well .. for making way too much money from the folly of the Fed.
* "It will move up, but the music always stops," -- Quincy Krosby, market strategist for Prudential Financial, in a Dec. 29, 2009, article by the Associated Press.
As we learned this week, the music stops for a lot of investments. And when it does, it's nice to own gold.
* "Our bottom line is this: Gold is a bubble now, and it is too late to get in. It is like someone who bought real estate in 2006, at the height of that bubble. You could get hurt really badly." -- Kimberly Sterling, Orlando, Fla. financial planner, in an April 2010 story by the Orlando Sentinel.
You know what else hurts? Not owning gold when it hits yet another new high.
* "Don't put your money on a simple rock. & It is "fear metal" -- you buy it when you are afraid of every other investment." -- James Altucher, managing director of Formula Capital, in a July 12, 2010, blog post on The Wall Street Journal's website, wsj.com.
Hey, at least it's a pretty rock. And the people are fearful. Very, very fearful.
(Al's Emporium, written by Dow Jones Newswires columnist Al Lewis, offers commentary and analysis on a wide range of business subjects through an unconventional perspective. Contact Al at email@example.com or tellittoal.com)