Well at least I can rest easy knowing that some things are the same everywhere. When Phoenix had a REAL gas shortage two years ago due to the one major gas pipeline being shut down for 3 weeks and trucks not being able to keep up, it just went downhill each day that we were out. While they never reported any actual fights, they had to station police at all the major stations that still did have any gas just to direct traffic and keep people from getting out of control. In a way, it was good that so few stations had any gas, because that way the police only had a limited number of stations to keep an eye on.

 

I flew out of Charleston, SC this morning and they had a similar rumor that all gas stations were closing at noon. The radio stations were telling people it was false, but people were still lining up at the stations.

 

If you think gold is expensive right now, you need to take a really good look at what you know about history and money. Gold is astronomically (some suggest criminally) cheap and undervalued right now. Silver even moreso.

A piece of silver the size of a dime used to be a laborer's day wage not all that long ago. You would be very very smart to have at least 10% of your portfolio in precious metals.

 

Can anyone explain to me what the value of gold is? I mean, other than jewelery, what do we use gold for in significant quantities? I've heard of gold plated contacts for some semiconductor chips and stuff, but other than that, I honestly don't know of a single industrial application for gold. As such, I can't figure out what gives gold any inherent value. Anyone? In the mean time, I give you this:

 

It's difficult to convey why Gold is important (and undervalued) in a quick manner due to changes in monetary policy around the world for the last 30 years (compared to the previous 5000 years of human history).

This is a reasonable introduction, but if you start digging around and doing research on the history of gold, especially in terms of monetary policy, you'll start to see why current prices are quite low.

http://www.gold-eagle.com/editorials...ich121698.html

Gold is a preservation of wealth... not an industrial commodity. It is valuable because it can't be artificially inflated, is rare, and up until 1970 was still the backbone to government economies. Prior to 1933 it was the backbone to the *entire* world economy.

Prior to 1913 there was no overall inflation because gold and silver dictated the amount of money available to be spent, invested, and saved. After that point, it has skyrocketed to where if you saved $100,000 in 2005 dollars it would be the same as saving $5,000 dollars in 1913.

http://eh.net/hmit/compare/

You can use that page to see what the relative value of dollars were. What's most interesting is to see how from the 1700's to the 1913 the relative costs drifted up and down, but always moved back to a relative mean. Therefore, if a family saved $10,000 in 1800, they could have expected to buy roughly the same amount of goods with that same $10,000 in 1900. Prices went up and down due to things like war, supply, etc... but the overall price was the same.

Ok... now for what that means for us today: When people lose confidence in the currency, or fear economic recession, they tend to flee into Gold because it holds it's relative value in the long run. A stock can go to $0. Your $$$ will slowly lose value due to inflation. So you can look at gold and silver as a barometer of the relative health of an economy. As the economy hits troubled waters, the price of gold rises.

Something worth knowing... The Central Bankers (IMF) all conduct *all* of their transactions in gold and do not accept cash. They don't trust each other, so they use gold as it's the only storage of wealth that can't be printed, inflated, or faked.

Although it's semi-off topic... it's kinda on topic because as the price of gas increases, the economy will be hit, which will affect the stock market, value of the dollar, and ultimately the value of precious metals.

Hope that helps.

 

AWESOME shot, AZCivic. It's saving to my pics as we speak.

 

Funny you should mention it, but yes they should be... The price of diamonds is kept artificially high by the debeers corporation which controls the supply.

>Shouldn't diamonds be cheaper?