Gold

[chris_gerrib]

So, as anybody who's seen even five minutes of Fox News knows, the buying and selling of gold is getting a lot of attention lately. Part of that is because (as of this writing) gold is selling for over $1600 per ounce. Having said that, one blogger thinks that this is as a result of a pump and dump scheme.

For those who don't speak finance, a "pump and dump" is a deliberate fraud in which somebody buys an investment cheaply, hypes it in the news to drive up the price, and then when they think it's on top they sell it, pocket the cash and leave town. Those who bought at the inflated price are left broke and holding the bag.

Now, I'm not for sure that people are deliberately pumping and dumping. However, I'm pretty sure that, when your cab driver and the USA Today are telling you to buy an investment, we're in a bubble. So I'm not buying.

I am even more sure that those people who advertise on TV to "send us your gold" are a bad deal. To nobody's surprise, the Consumerist did an investigation and found consumers were getting paid late and significantly less than what their gold was worth. In short, now is not the time to buy gold, it's time to sell, and if you want to sell, go to a jeweler or pawn shop and don't mail it in.

Comments

[daveon.livejournal.com]

Well, if you moved some of your money into gold a while ago then you should be fine, but if you're getting in now, then you are quite right. Like people buying property in late 2007.

I was worried when we bought in early 2005 that we bought at the top, except the market continued up and, in London, the prices now are pretty much where I paid - which is a relief...