Loading ...Buy and Hold
a HYPOTHETICAL
In Jan 1980 Gold went Parabolic and then went into a coma for 20 years
I was 30 years old. If I had put $100,000 into SPX Stocks AT THAT POINT and held until now
Through all the trials and tribulations…I would at age 66 now have $2,200,000.
I think that beats Inflation !!
On the Other hand if I bought $100,000 worth of Gold thinking the End is Nigh in Jan 1980 I would have $140,000 now
Which market has proven to be the Inflation hedge ?
Yes, i agree but 1980 was a high for gold and sort of bottoming area for stocks right? Not counting dividends what would the returns be from around 1971? – the only date that should be used imo for this kind of comparison?
http://stockcharts.com/freecharts/historical/marketindexes.html
Good Point Gary but I didn’t have $100,000 in 1971
I had a guitar though
Guitarist too huh? I play PRS’s.
Was a Pro bass player in a couple of killer bands back in the day
You’re Lemmy!
Er, no, he’s dead.
🙂
A guitar might be even better for attracting the girls. $100k not needed.
Gold (and especially) PM stocks are a speculation game ,not an investment.
Stock market is what the country is,PM stocks and Gold is where the speculators are.
I sometimes think of a person I don’t know–a friend of an acquaintance of mine at the time. This unfortunate person, convinced **right** at the peak of the price of Au in 1980 that everything but Au would be essentially worthless, liquidated all his assets (don’t know whether that meant a little or a lot) and put all the proceeds into Au. Right at the top. I remember hearing the story just as the price was starting to go down.
(I had little in the way of assets or debt at the time–was a great spectator sport for me though.)
If you did the same thing in 2000 the result would be much different as of today.
Agreed.
Gold will have its day, but it can take 20-30 years I am afraid. Some analyst see 30-year cycle in gold tops, 1980, 2010, 2040; So we have plenty of time! Maybe by then interest rates will be 10%+ again, who knows.
It’s arbitrary to take 21 Jan 1980 because that was a bubble top for gold. As it would be to take March 2000 which was a bubble top for stocks. How about taking a good date like 15 August 1971 when Nixon closed the gold window and both gold and stocks were more or less free trading?
Looking at your chart, there wouldn’t be much in it and this would have included almost all of the inflationary period of the 70s, together with the lesser inflations around 1987-90 and the 2006-2008 timeframe too.