Can you spot the Bubble(s)?

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Can you spot the Bubble(s)?

May 9, 2012 Leave a comment Go to comments

With gold and silver gradually heading south since leap day, many PMs investors are beginning to get cold feet. Then we have, over the weekend Charlie Munger, Berkshire Hathaway’s No.2 commenting that “civilized people don’t buy gold”. Not surprising - why would anyone bother since “gold is a barbaric relic” anyway. And with Bill Gates saying he’s in the same camp with Buffett & Munger, are we missing something?

Today, GATA posted an “encouragement from Embry and Sinclair”, while Jim Sinclair wrote in his “Answering The Cries For Help” email despatch:

Today has been interesting in a perverse way. I have heard from every gold short who knows my name. I have heard from every weak gold holder that knows my name yelling for help. This time I cannot answer all the incoming communications. Nobody could.

A month ago I got over 3500 incoming emails in less than three hours. The shorts exulting by email really cannot expect an answer. Even the weak gold and frustrated gold share holders cannot expect me to assuage their pain one at a time. ..

It sure does look or sound scary out there. If I were a PMs investor, I’d probably be among the first to heed Sinclair’s advise “If you cannot stand the heat you must get out of the kitchen”.

But if you’re not investing in gold or silver, merely holding them as a form of currency, there’s really no need to panic. Take a minute to study the chart below. It puts things into perspective. And while you’re at it, try to see if you can spot a bubble or two!

Perspective: The BIG Picture
Mouse over each bar for details. Click on bars for data source.