SUBSTANDARD :

Fool's Gold : The economy's in chaos. The world's a mess. So why are gold prices stagnant? (Mark Lewis, August 13, 2002, Slate)

Gold is supposed to be the ultimate hedge against financial disaster. As such, it tends to attract investors from the paranoid fringe, the sort who invested heavily in canned goods and bottled water before Y2K and who keep a few Krugerrands buried in the backyard to be bartered for food when the world goes to hell and "fiat money" becomes worthless. This doomsday cult aside, gold is the realm of the hardheaded pessimist, who studies the many ominous portents currently on display and concludes, not unreasonably, that things may get a lot worse before they get better. Many people are very nervous these days--yet gold thus far has failed to take off into the stratosphere. What gives?

A comforting answer would be that the long and painful decoupling process finally is complete, and the link between gold and money is now severed.

Isn't the real problem with gold that it is just like any other commodity and their prices have all been falling for decades, as the great Julian Simon most spectacularly demonstrated when he made his famous wager with that colossal quack Paul Ehrlich. As Ron Bailey tell's it in his book, Ecoscam: "In October 1980, Ehrilch and Simon drew up a futures contract obligating Simon to sell Ehrlich the same quantities which could be purchased for $1,000 of five metals (copper, chrome, nickel, tin, and tungsten) ten years later as 1980 prices. If the combined prices rose above $1,000, Simon would pay the difference. If they fell below $1,000, Ehrlich would pay Simon. Ehrlich mailed Simon a check for $576.07 in October 1990."
Posted by Orrin Judd at August 13, 2002 8:37 PM