Gold News

Gold Investment – Uncharted Territory

Investment gold prices have risen for a record 10 years running...

TEN YEARS RUNNING – the Gold Price has risen in price for 10 consecutive years, writes Chris Weber in Daily Wealth. Not one year since this century began has gold not gone up in value.

Compare this to any other investment bull market and you won't see its equal. Take the huge Nasdaq bull of the 1990s. Or, really, of the 1980s and '90s.
The Nasdaq closed at 151 points on the last day of 1979. It soared to close 1999 at 4,069. That's 2,595%. But during those two tremendous decades, there were down years: 1981, 1984, 1987, 1990, 1994. That was the last down year, until 2000, when it all fell apart. But during that huge time, the most consecutive years of investment profits the Nasdaq average could muster was just five (1995 through 1999). But long before the end of 1999, the bubble was apparent. Everyone and his pet seemed to be talking about how much money they had made in the Nasdaq.

Mid-1982 to October 2007 saw a quarter-century of gains unlike any other in the Dow Jones Industrial Average. From 780 to 14,165 – bottom to top – that was a rise of 1,716%. So transformative was this move that people still think in terms of it: that stocks are the only thing you should really be in, that they cannot lose. That's what a 25-year bull market will do.

But during that magical quarter century, the most consecutive years of rises in the Dow amounted to nine: all the years from 1991 through 1999.

Until what happened recently, that was the greatest record I could find. And I've tried. I've gone back to 1800, to the one stock exchange that would be the most powerful over the next two centuries: the London Stock Exchange. It has managed to string together only eight consecutive years of gains.

Now, there may be a rather obscure investment market that broke the Dow Jones' nine-year record during the 1990s. But I haven't found it.

That is, not until the end of 2010. This past year marks 10 years of consecutive rises for gold. From a low of $255 to a high of $1421, that is a rise of 457%. Not the huge thousands of percent we saw in the Dow and Nasdaq... not yet. But for sheer consistency, I have never seen another market do what Gold Investment has just done.

In 2001, when I first bought gold in this current run, it was something that you kept very much to yourself. You thought, yet you said nothing. It was easier that way.

Today, I still say very little, but what I say is very different. Instead of doing the stupid thing and telling a few people to buy, this past year I mostly just asked people, with a wondering look, what they thought about gold. Is the price rise something you understand? Well, most people, if they even think about it, still don't really understand it. If they own anything at all, it is a few shares of Newmont, the Gold Mining giant.

No, as great as the last 10 years have been, we still have much left to see. Sure, I'd be crazy to say that we'll never have a down year. We've already beaten the odds. Each passing year is a tremendous statistical obstacle for yet another consecutive annual win. And yet, if (when) gold finally has a losing year, I think we'll see choruses of "Ha! I knew it was phony! Stocks are really the place to be!"

Knowing full well that a person would have to be crazy to try to forecast anything over one year, here goes: For gold and silver, everything tells me that they will continue strong. However, I'm waiting to be proven wrong. You don't ever see a major market go up 10 consecutive years. For gold to increase again next year would make it 11.
At some point, you throw up your hands.
For gold, we clearly are in uncharted territory. No one knows what is going to happen in the short term. But I believe that 10 straight years of gain and still keeping somewhat under the radar screen means that there is much more to come. It also means that, slowly but surely, gold is making its way back into the monetary system of the world. And silver is not far behind. This will be the story of the next decade.

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Starting with $650 saved from his newspaper round, Chris Weber began buying and trading gold at age 16. A millionaire by 20, he switched into foreign currencies and debt investments as the US Fed finally started to tackle inflation in the early '80s. Now he shares his trades and insights with private investors through the Weber Global Opportunities Report.

See full archive of Chris Weber articles

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