According to Jim Cramer gold isn't done yet. He says that even after the recent drop in the price of gold, it is still up 11% for the year! After golds big dip in 2008, it jumped 52% in price over the next year. So gold isn't gone yet!
By Jim Cramer
Thu, Dec 15, 2011 10:45 AM
People taking note of the banks holding up. People taking note of the FXE bouncing. People thinking a commodity collapse may not be all that bad.
I get that. I get the constant desire to call the bottom. I get the idea that we could bounce.
I simply want to point out that we need reasons beyond "commodities down, buy financial assets" -- because we have been down this head-fake path so, so many times. You don't need to be a hero here. General Mills (GIS +0.58%), Altria (MO +1.32%), General Electric (GE +1.08%), Kraft (KFT +0.83%) and the other higher yielders can be bought. You can participate in the MarkWest (MWE +0.83%) below where it was priced.
You can own US Bancorp (USB +0.08%) if you really have to. It's the bank I like. But why? To catch a 1% rally? To bet that the IMF is intervening tonight? I have bigger fish to fry.
Random musings: Before you give up on gold, consider these facts provided by our own Alix Steel. From the beginning of October 2008 to Oct. 24, gold sank 20%. It hit a yearly low of $695 an ounce, which was a 32% sell-off from 2008's high of $1,023 an ounce.
From Oct. 24 2008 to Oct. 24 2009, gold rallied 52%. Wednesday's price of $1,580 an ounce is only 17% lower than 2011's high of $1,923 an ounce. Gold is still up 11% for the year. Take that, deflation!
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