Is Gold in a bubble? probably yes – unless you listen of to some experts who seem to think that today’s prices are the new norm, and it will go much, higher. No-one really know though at the end of the day. Also which point in the bubble are we? Near the middle or near the top? Again no-one knows.
Where else can you put your money anyway? I have some Premium Bonds. Very safe but the odd £25 win is a pittance really. I have a savings account but again even on a good rate this is getting 3% before tax. I also bought some shares in BP a while back just after their value had plummeted. These have done very nicely but the stockmarket is so volatile and nervous at the moment that any gains could be wiped out an a matter of days. The OP could have bought a house with his 10K deposit and then seen all of his deposit get lost as houses drop in value over the coming year.
So Gold seems a good and safe alternative and there seems to be real returns to be made. The sign’s I’m using to sell my Gold are:
A major improvement in confidence in the global and European economy.
A rise in UK interest rates.
These two things I suspect could bring about an end to the Gold bubble as investors faith in currency, binds and other investments starts to return.