Salon 1

There is no doubt that the current US economy in trouble.  This is evident by the rapid increase in gasoline prices to the point where it is having impact on everything (driving to work, shipping products, airlines), and many average income people loosing their homes.  What better signs could there be?  Many are debating whether this is a recession or not because it has not met the formal definition of a recession.  This is just semantics.  The point is that yes, of course, the economy is in trouble, and you can call it whatever you want.

Interestingly though, I have been hearing a lot of people talk about gold as the ultimate investment because there is security there based on the premise that gold has always been valuable in this world, and always will.

The truth is that gold does not have any real value.  It has been the most common bartering chip over the years, but, by itself, you cannot eat it, drink it, and it will not keep you warm in the winter.  If the world’s infrastructure totally collapsed (pick your favorite 80s sci-fi movie, e.g., The Road Warrior), gold would be totally worthless.  Food and water have real value, but even more valuable (and with real value) is oil.  Oil is the lifeblood of an industrial society.  Unless you want to revert to pre-industrial times (which could have its benefits), or until there is something that can replace it, we need it.  My only regret is not having bought stock it in before 2000.  The problem, of course, is that the world’s supply is not infinite at the rate we are using it, and that rate is increasing exponentially.  We need to develop a back-up fast.