Posted Dec 29, 2013 by Martin Armstrong
Gold never actually broke out in real terms – only nominal. Adjusted for inflation, gold has actually been one of the worse investments since 1980. A $1,000 in 1980 invested in gold get you about $1,371 today compared to the Dow Jones that would yield at $16,000 plus dividends or closer to $18,000. MINING has reported that this has been the worst year for gold since 1981. MINING has also reported that Canadian miners are perhaps the hardest hit. This is part of the process of how markets collapse. Mines will close, reducing supply, the herds of gold investors get burned and will not come back again so easily. The mines that do survive start hedging and this will build the short positions for the low. It is always the same pattern over and over again. Each generation seem to have to learn that lesson first hand. Like a child, who you say do not tough the flame on a candle, must always still stick their finger in the flame. The real question remains, how many gold investors will become gold traders or just lick their wounds and try a different investment?