Tuesday, October 5, 2010

All that glitters

The super rich are buying gold again. I mean real gold, the kind you put in a vault. In this case, the kind you use a front end loader to put in a very big vault.

One couple bought a ton of the stuff -- worth $42 million, according to Reuters.

Now whether you should be buying gold is between you and your paranoia. What's this buying have to do with me? Robert Frank writes in The Wall Street Journal:
It has long been a tacit understanding in the U.S. that the wealthy will invest their excess cash in productive, job-creating businesses. For decades, most of the money invested by millionaires has gone into stocks and bonds–products that, whatever their pitfalls, helped fund Main Street by providing capital to companies and governments.

What does gold do? Nothing but sit in a safe. It doesn’t launch start-up companies, it doesn’t help towns build roads and it doesn’t create jobs (except those for safe companies and coin dealers).
A new survey says that the super rich are more pessimistic than they have been since April 2009. Moreover, they have to be as uncertain as the rest of us about what will happen, especially in Washington.

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