Recently by Bill Bonner: Bernanke's Plot To Overthrow the USDollar
Our first call came in this morning:
“Is this the Battered Goldbug Hotline?”
“Yes…you’ve come to the right place.”
“Thanks…I need help. I’ve been battered by the nasty gold market.”
“You poor thing…go ahead…spill it out…here at BGH, we’re ready to help.”
“Well, I bought gold about 5 years ago. It was at $700. Then, it went up every year…year after year. I made a lot more money than all my friends. My stupid brother-in-law bought the banking sector instead. What an idiot.”
“Go on…”
“Well, the price went up and up…and I thought it was going to hit $2,500. I mean, it would have to get to $2,500 just to equal the rise in the ’70s. And we all know that things are much worse than they were then. But instead…sniff, sniff…it fell! I couldn’t believe it. And when I checked yesterday, it was down to just $1,616. And maybe it will head down now…and keep going down. I feel very battered. What can I do?”
“Wait a minute…haven’t you more than doubled your money, from $700 to $1,600. What’s wrong with a 100% gain?”
“Well, nothing, but I thought it was going to $2,500.”
“What would you have done if it had hit $2,500?”
“Well, I guess I would have waited for it to go up some more. I would have held onto it. I’m a long-term investor.”
“But you’re holding onto to now, right?”
“Well, now I don’t know. It looks like it might be going down.”
“You mean, you would hold at $2,500 but sell at $1,600?”
“Well, yes…”
“Then, do me a favor. Call your brother-in-law. Tell him he’s talking to a moron. You’re supposed to sell high, and buy low…not the other way around. Click.”
And you, dear reader, do you have a question about gold? Would you like some advice? Do you feel battered? Just call our Battered Goldbug Hotline. Another helpful service brought to you by The Daily Reckoning. (Calls will be billed at $1 a second…and we will put you on hold while we read the newspaper. Check your personal horoscope. And have a glass of wine.)
Reprinted with permission from the Daily Reckoning.
Bill Bonner is the author, with Addison Wiggin, of Financial Reckoning Day: Surviving the Soft Depression of The 21st Century and The New Empire of Debt: The Rise Of An Epic Financial Crisis and the co-author with Lila Rajiva of Mobs, Messiahs and Markets (Wiley, 2007). His latest book is Dice Have No Memory. Since 1999, Bill has been a daily contributor and the driving force behind The Daily Reckoning.
